Trump doubles metal tariffs on Turkey as lira falls by 20%


12 August, 2018 10:28 AM

Trump doubles metal tariffs on Turkey as lira falls by 20%

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President Donald Trump has doubled US tariffs on Turkish steel and aluminium, as the precipitous fall of the Turkish lira accelerates.

In a tweet, Mr Trump said the currency was weak against "our very strong dollar", adding that "US relations with Turkey are not good at this time".

Turkish President Recep Tayyip Erdogan said in a speech that the drop was part of a "campaign" led by foreign powers.

Turkey also warned it would retaliate against the US tariffs move.

"The United States should know that the only result that such sanctions and pressure will bring... will be harming our relationship as allies," the Turkish foreign ministry said in a statement.

The two Nato members are at odds on a range of issues - how to fight the Islamic State group, Ankara's plans to buy Russian missile defence systems and how to punish the alleged plotters of a failed coup in Turkey in 2016.

Most recently, President Trump issued sanctions on top Turkish officials over the ongoing detention of a US pastor who is facing terror and espionage charges in Turkey.

What is happening in Turkey?
In the past 24 hours, the lira has lost around 20% of its value. It had already fallen more than 40% in the past year.

In a televised speech on Friday, President Erdogan called on citizens to exchange foreign currency and gold for lira, calling it an "economic war".

"This is a domestic and national struggle," he said, as the lira continued to fall.

In a veiled attack on the US he added: "Some countries have engaged in behaviour that protects coup plotters and knows no laws or justice."

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

After he spoke, Mr Trump tweeted that aluminium tariffs "with respect to Turkey" would be raised to 20% and steel to 50%.

The reaction from global currency markets to the rift caused the euro to slump to a 13-month low and pushed the dollar to a one-year high.

The Turkish trade ministry responded that the additional tariffs were against the rules of the World Trade Organization.

"Turkey expects other member countries to abide by international rules," the ministry said in a statement, adding that the US remained an important trade partner.