Trump doubles steel and aluminum tariffs on Turkey

Trump doubles steel and aluminum tariffs on Turkey

Relations between the two countries deteriorated in the wake of US President Donald Trump's decision to increase tariffs on Turkish aluminum and steel to 20% and 50% respectively.

Turkish President Recep Tayyip Erdogan warned the US on Saturday that Turkey does not respond to threats, a day after President Donald Trump announced he would double the rate of tariffs on Turkish metals.

Last week, the United States imposed sanctions on Turkey's justice minister and interior minister for not releasing pastor Andrew Brunson.

Professor Petras said that "it's very clear that the United States is very hostile to Turkey's opening relations with Russia, Iran and expressing some independence on Syria". Turkey has mostly done that to itself - until, that is, Trump started tweeting.

President Tayyip Erdogan denied on Saturday that Turkey is in a currency crisis, dismissing a plunge in the lira as "fluctuations" which have nothing to do with economic fundamentals. "We think that Erdogan needs to act now if he does not want Turkey to develop into a mini-Venezuela (worst case scenario)".

"Change the euros, the dollars and the gold that you are keeping beneath your pillows into lira at our banks. This is a national, domestic battle", he told a crowd in the northeastern city of Bayburt. Which is why Trump's tweet made it fall even further than Erdogan's reality-starved speech had already made it.

The currency turbulence coincides with the most bitter dispute with the United States since the 1974 Turkish invasion of Cyprus, which so far shows no sign of abating. According to figures from the Turkish Government, for the period of 2002 to October 2017, Turkish direct investments in the United States reached $3.7 billion while USA investments in Turkey amounted to $11.1 billion, second only to the Netherlands' 21.6 billion.


'If they have their dollar, we have the people, we have Allah, ' he said. This situation has led the European Central Bank to sound alarm bells warning that Turkey's currency problems could infect Europe's banks.

Investors piled into "safe" government debt, with German yields hitting three-week lows and the yield on the benchmark US 10-year Treasury note falling to 2.88822 percent.

Turkey's currency slumped to a new record low as Donald Trump compounded the country's economic crisis by doubling steel and aluminium tariffs.

"This innocent man of faith should be released immediately", Trump previously wrote on Twitter when it became clear Turkey would not release the evangelist, who was ordered to be held under house arrest. The Treasury Department announced fresh sanctions on two Turkish government officials in response to Turkey's refusal to let Brunson go. US stocks were also rattled. His comments on interest rates - and his choice of a family member as finance minister - have heightened perceptions that the central bank is not independent. Inflation increased 16 percent in July, and Erdogan has insisted that interest rates not increase.

Foreign investors could be spooked and try to pull their money out, reinforcing the currency drop and potentially leading to financial instability.

'The price of the food that I buy increases day by day, the fuel that I put in my auto to distribute lunches is more expensive, but I can not raise my prices from one day to the next, ' she said. At one point, it was down as much as 19 percent on the day, before rallying a bit to bring it to "only" a 13.7 percent loss.

"The basic reason the exchange rate has gone off the rails is that confidence in the management of the economy has disappeared both domestically and overseas", said Seyfettin Gursel, a prominent economist and a professor at Turkey's Bahcesehir University.

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