Trump doubles tariffs on Turkey, stoking jitters

Irving Hamilton
August 11, 2018

So, to hike tariffs on Turkey, Trump needed a reason why maintaining America's domestic metal industry required imposing even steeper tariffs on Turkish exports than were already in place. Global markets sold off overnight amid the geopolitical tensions and fears of financial contagion.

As he spoke, the lira fell further - adding to worries about the country's financial stability. Lindsey GrahamLindsey Olin GrahamGOP lawmaker: Every white suburban district in the country will be a swing district this year The Hill's Morning Report - Trump to GOP: I will carry you GOP senator: "Real likelihood" Dems win the House "by 10 or 12 more seats than they need" MORE (R-S.C.) tweeted Friday. The Treasury Department announced fresh sanctions on two Turkish government officials in response to Turkey's refusal to let Brunson go. The future contract for the Dow Jones industrial average was down 0.4 per cent and the contract for the S&P 500 lost 0.5 per cent.

President Donald Trump's decision to double USA tariffs on steel and aluminum imports from Turkey is "brutal", director of the European Council on Foreign Relations said. Erdogan has appealed to the people to convert their dollars to liras, saying Turkey is in the midst of an "economic war" with the West.

Early in his administration, President Donald Trump was criticized for placing a congratulatory call to Turkish President Recep Tayyip Erdoğan - an authoritarian leader.

Turkey remains at loggerheads with the United States over the detention for the last two years of American pastor Andrew Brunson and a host of other issues. It was almost 6 per dollar early Friday morning in D.C.

Trump is also declaring that, "Our relations with Turkey are not good at this time!". He claims higher rates lead to higher inflation - the opposite of what standard economic theory says.

Turkey vowed retaliation "without delay" and warned the move would further harm relations between the two allies.

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It added that Trump's remarks were "not possible to reconcile with state seriousness".

Cenk Mutlu, who has owned a small jewellery shop in Istanbul's Grand Bazaar for decades, has been forced to display signs which read "discount" and "big sale".

They are also concerned over the central bank's ability to rein in persistent double-digit inflation with the president repeatedly calling for lower rates.

Turkish outlets reported that Mr Erdogan is seeking the release of Mehmet Hakan Atilla, a Turkish banker serving a 32 months sentence in NY for evading Iran sanctions.

Concerns are mounting that the decline will start to hit European banks.

Shares in BBVA were down 5.7 percent late on Friday, UniCredit was off 6.4 percent and BNP dropped 4.4 percent, all exceeding a 4.3 percent drop in the euro zone bank index.

The currency drop will also increase the cost of living for people in Turkey by making imports more expensive. As recently as April the ratio was about four lira per dollar.

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