Trump Escalates Feud With Turkey, Imposing Higher Metals Tariffs

The euro has dropped today after the Turkish lira ad Russian rouble plummeted

The euro has dropped today after the Turkish lira ad Russian rouble plummeted

Turkish President Recep Tayyip Erdogan spoke before the nation twice on August 10, but the country's currency continued its descent, reaching about 6.4 lire per dollar, a decline of about 14.6 percent.

The White House said Trump would use a section of US law that allows for tariffs on national security grounds to impose the increased duties.

The penalties also bar any U.S. transactions with the two men.

The value of the Turkish Lira has fallen by 2/3 since the start of the year.

Economist Chad Bown, who specialises in trade issues, said Turkey accounted for just over four percent of United States steel imports in 2017, but a very small fraction of the aluminum brought into the country.

Trump intensified the alarm on financial markets with his new tweet doubling the tariffs, noting for good measure the lira was sliding "rapidly downward against our very strong Dollar!".

He also said it was wrong of the U.S. to try to bring Turkey into line with threats, a day after Trump doubled tariffs on steel and aluminium imports from Turkey.

"Do not worry!" He said Turkey was not afraid of "threats" and added Turkey had "alternatives" for economic cooperation in many places "from Iran, to Russian Federation, to China and some European countries". Financial upheaval there risks further destabilizing an already volatile region.

Turkish President Recep Tayyip Erdogan says his country is at war and will not lose.

On March 1, Trump had announced global tariffs of 10 percent on all aluminum to the USA and 25 percent on all steel imports. The White House said he had authorised them under Section 232 of United States trade law, which allows for tariffs on national security grounds. Erdogan has frequently blamed an "interest rate lobby" and Western credit ratings agencies for trying to bring down Turkey's economy.

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".

Turkey remains at loggerheads with the United States in one of the worst spats between two North Atlantic Treaty Organisation allies in years over the detention of American pastor Andrew Brunson and a host of other issues.

It said it would support steel and aluminium exporters on all global platforms, and the U.S. remained an important trade partner.

While the International Monetary Fund has a history of lending a hand to Turkey, Erdogan is wary of the organization, creating barriers to a bailout. -Turkish relations is a dispute over an American clergyman who has been jailed in Turkey since December 2016. He added that the country will continue to enjoy good economic relations with several major nations. Gulen denies the allegation.

Andrew Brunson, an American pastor, living in Izmir, Turkey.

In a tweet, Trump cited the decline in Turkish currency as justification for increasing tariffs to 50 percent on Turkish steel and 20 percent on Turkish aluminum.

Turkey's sovereign dollar-denominated bonds tumbled with many issues trading at record lows.

The defiant tone and war rhetoric only hurt the lira more, before Erdogan's finance chief and son-in-law, Berat Albayrak, tried to ease investor concerns during a conference, saying the government would safeguard the independence of the central bank.

On Friday, they also had to also factor in Turkey's economic crisis.

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