Turkey Fallout May Also Hit Indian Markets

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President Trump said Friday the USA will double tariffs on steel and aluminum for Turkey, noting the relationship between the two states "are not good at this time!".

The lira has always been falling on worries about Mr Erdogan's influence over monetary policy and worsening relations with the United States. The Nasdaq composite was down more than 0.8 percent as technology stocks also dropped.

Turkish currency has lost about 40 percent of its value in the past year.

Relations with Washington worsened further Friday when Trump tweeted that he had authorized a 20 percent duty on aluminium and 50 percent duty on steel. What possible reason could there be behind the lira, which was at 2.8 against dollar on July 15, 2016, to slide below 6 yesterday?

In a Friday opinion piece for the New York Times, though, he used a milder tone to restore ties before it is too late, reminding of long-standing relations the USA established with Turkey over half a century ago upon its accession into North Atlantic Treaty Organisation.

An important emerging market, Turkey borders Iran, Iraq and Syria and has been mostly pro-Western for decades.

Turkey's embattled lira on Friday hit new record lows against the USA dollar and euro, losing over seven percent in value as strains with the United States showed no sign of abating and fears grew over the exposure of European banks.

In a tweet on Friday, Foreign Ministry Spokesman Hami Aksoy said President Donald Trump's decision, which also violates the rules of World Trade Organization, "cannot be associated with seriousness expected from a state".

"Those who assume they can bring us to our knees through economic manipulations don't know our nation at all", he said.

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"These are the bullets, cannonballs and missiles of an economic war waged against our country", he said.

On Friday, the euro sagged to a 13-month low against the dollar, down 0.7 per cent to $1.1450, after the Financial Times reported that the European Central Bank was anxious about possible losses at eurozone banks operating in Turkey.

In retaliation, Turkey imposed additional tariffs worth 266.5 million USA dollars on US goods in June.

Erdogan said high foreign exchange rates were the means used in plots against Turkey. I hope we can soon get Pastor Brunson and other Americans released in a win-win fashion for both the United States and Turkey."Trump's move to double tariffs on Turkey was even praised by one of the president's most frequent Democratic critics".

The sides held talks in Washington this week but failed to resolve the spat.

Although the pastor's arrest has soured already-fragile ties with Washington, Erdogan said there would be no let up in Brunson's case, vowing: "We have not made concessions on justice so far, and we will never make any".

Brunson was among many foreign nationals detained by Turkish President Erdogan in the wake of a failed 2016 coup attempt.

Mr Erdogan said the United States had "repeatedly and consistently failed to understand and respect the Turkish people's concerns".

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