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Trump doubles tariffs on Turkey, stoking jitters

Trump doubles tariffs on Turkey, stoking jitters

This came in the wake of sanctions imposed by Mr Trump for Turkey's refusal to free pastor Andrew Brunson, who the nation detained on terror charges despite the insistence of the USA he is innocent. US stocks were also rattled.

The Turkish lira fell at least 13 percent Friday, as President Erdogan called for people to exchange their other forms of money to the lira.

Mr Trump has insisted that Mr Brunson, who has lived in Turkey for more than 20 years, be released "without delay"; Mr Erdogan insists his government can not interfere with the judicial process.

Trump said Friday on Twitter that he authorized a new 20 percent tariff on aluminum and 50 percent tariff on steel from Turkey.

In a New York Times article on Saturday, Mr Erdogan warned that Turkey would be forced to seek new friends.

Turkey's financial crisis and further USA pressure spurred more concern among investors as fears appeared to spread to American markets.

President Recep Tayyip Erdogan says his government "will not lose the economic war".

The lira's plunge is one of the most serious economic crises that Erdogan has faced since coming to power in 2003 in the wake of a financial crisis in 2001 that brought the economy to near meltdown. "The tweet is mightier than the Turkish sword", Cristian Maggio, head of emerging markets strategy at TD Securities, said in a note to clients.

Turkey's woes shook world markets, pushing down stock indexes and lifting the dollar, which traders around the world typically buy in times of concern. The sides held talks in Washington this week but failed to resolve the spat.

The Turkish crisis has set off a wave of selling across emerging market assets, reviving the spectre of contagion that has been the sector's Achilles heel for decades. Which is why Trump's tweet made it fall even further than Erdogan's reality-starved speech had already made it.

In a tit-for-tat response to the United States sanctions, Erdogan responded by announcing that the assets in Turkey of the USA secretaries of "justice and interior" would be frozen.

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Erdogan said during an address to supporters: "Change the euros, the dollars and the gold that you are keeping beneath your pillows into lira at our banks".

"Some countries have engaged in behavior that protects coup plotters and knows no laws or justice", he said.

He added: "Relations with countries who behave like this have reached a point beyond salvaging".

"The U.S. runs the risk of losing Turkey as a whole". It is host to an X-band radar, a critical part of the Western alliance's missile defence system again Iran.

Turkey was facing artificial financial volatility, Erdogan said, and people should look to the "big picture" instead of foreign exchange prices.

The Turkish lira TRYTOM=D3 has always been falling on worries about Erdogan's influence over monetary policy and worsening relations with the United States. Gulen has denied the allegation. Brunson was moved from prison and placed under house arrest on July 25.

Erdogan retaliated last weekend with sanctions of his own against the American counterparts of the sanctioned Turkish ministers.

Halkbank has said that all of its transactions were lawful.

What's happening to Turkey's currency right now?

"First of all, confidence needs to be regained".

South Africa's rand took a sharp hit on Friday, over heightened worries that country might be next to face similar troubles to Turkey, like high inflation, an overheating economy and a lack of credible central bank independence.