Turkey takes action in bid to curb currency crisis

On Friday the lira fell as much as 18 percent, its steepest decline since 2001. He is under house arrest.

Turkey and the US have recently butted heads over a handful of issues including differing interests regarding the civil war in Syria and Turkey’s desire to purchase Russian defense systems. It tied the news reports to “forces behind the July 15 coup attempt”, referring to a 2016 failed putsch that Turkey blames on a US-based Islamic cleric.

The Brunson case is just one of many bones of contention between Turkey and the United States, ranging from Syria to Ankara’s increasingly cosy relationship with Moscow.

The Trump administration threatened to impose additional sanctions on Turkey if it did not meet the deadline, Erdogan said. “They (US) said, ‘if you don’t release the pastor by 6 p.m. on Wednesday we will start sanctions.’ They are going to sanction our interior and justice minister”.

Last week, a Turkish delegation went to Washington and met American counterparts but there was no breakthrough.

The Turkish currency plunged 25 per cent against the USA dollar last week, with most of that depreciation happening on Friday amid escalating tensions with the Trump administration and market uncertainty about the ability of President Recep Tayyip Erdogan to manage the mounting problems in the Turkish economy. “If there are dollars under your pillow, take these out”, he told supporters at a rally in the northeastern Turkish town of Unye. US officials, including US Ambassador to Turkey John R. Bass, similarly said the accusations have no merit.

Even before the latest tensions, Erdogan had been courting Russian Federation, signing an agreement to buy a missile defence system.

Erdogan appeared to indicate that the entire alliance between Turkey – which joined North Atlantic Treaty Organisation in 1952 with strong American backing – and the U.S. was at stake. “We should also expect Turkey to draw even closer to Iran”.

Analysts say the crisis has been long time coming and reflects Turkey’s refusal to raise interest rates to curb double-digit inflation and cool an overheated economy. “It is clear that these attacks will continue for a while”. “We will be entering a strong period in terms of fiscal policies”, he said. The banking watchdog published a similar statement over the weekend, warning about false reporting on banks. This includes an emergency interest rate hike by the central bank, imposing capital controls, fiscal reforms, securing a rescue package by the International Monetary Fund or other lenders and ending the current diplomatic fight with Donald Trump.

No one has an interest in economic destabilization in Turkey, German Chancellor Angela Merkel said Monday, adding that Germany wants to see the country’s economic prosperity. Erdogan said. “There is no economic reason for this”.

“The aim of the operation is to make Turkey surrender in all areas from finance to politics”.

Erdogan has repeated calls for Turks to sell dollars and buy lira to shore up the currency, while also telling business owners not to stock up on dollars.

Hungary, for example, has seen its currency, the forint, fall by almost 4% against the United States dollar since last Wednesday.

Presidential Communications Director Fahrettin Altun described the rumors as “disinformation campaign” based on a statement by President Recep Tayyip Erdoğan, who had said on August 12 that “You must know that keeping this nation on its feet is not just our duty but also the duty of industrialists and merchants”.