Erdogan warns U.S. of harming its own interests, security

Erdogan warns U.S. of harming its own interests, security

He told his 57million followers: "I have just authorised a doubling of Tariffs on Steel and Aluminium with respect to Turkey as their currency, the Turkish Lira, slides rapidly downward against our very strong Dollar!"

But the souring in U.S. -Turkey relations could give new strength to Russia-Turkey ties, already a source of concern among Turkey's Western allies.

In relation to this latter dispute, Turkey's continued detention of American pastor Andrew Brunson, who was jailed 21 months ago in a widespread crackdown over a failed coup in Turkey, has increase hostility between the nations. Two days later, Secretary of State Mike Pompeo warned that Turkey that the "clock had run out" to release Brunson.

While Turkey and the United States are at odds over a host of issues, the most pressing disagreement for Trump has been the fate of American Christian pastor Andrew Brunson, who is on trial on terrorism charges for allegedly supporting a group that Ankara blames for a failed coup in 2016.

The lira tumbled about 10 per cent on Friday to another record low as investors worry about Erdogan's unorthodox economic policies and U.S. sanctions.

"If you have dollars, euros or gold under your pillow, go to banks to exchange them for the Turkish lira. This is a domestic and national struggle".

Turning to the economic effects of the diplomatic row, Mr Erdogan said: "If they have the dollar, we have Allah".

Turks have over the last half decade counted the rapid depreciation of the Turkish lira on the screens outside doviz (exchange) booths with a mixture of bewilderment, alarm and ironic amusement.

The currency's drop - 41 percent so far this year - is a gauge of fear over a country coming to terms with years of high debt, worldwide concern over Erdogan's push to amass power, and a souring in relations with allies like the U.S.

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Turkish Presidential Spokesman Ibrahim Kalin earlier wrote in the Daily Sabah newspaper that the USA runs the risk of losing Turkey as its ally.

In the New York Times article, Erdogan said: "Attempting to force my government to intervene in the judicial process is not in line with our Constitution or our shared democratic values".

The prospects for Albayrak being able to pursue an independent economic policy to safeguard the autonomy of the Central bank do not appear good.

On Saturday, Erdoğan urged Turks to help support the lira to win what he described as a "war of independence". The weakened currency's value has helped increase inflation and anxious global investors.

The lira has been falling on worries about Erdogan's influence over monetary policy and worsening relations with the United States.

The diplomatic dispute with the USA was one of the triggers that turned market jitters into a full-blown rout this past week.

Turkey's President Recep Tayyip Erdogan addresses his supporters in Bayburt, Turkey, Friday, Aug. 10, 2018. The predictable result is this has made inflation get out of control - it is up to 15.9 percent when they are supposedly trying to keep it to 5 percent - because the central bank has been so slow to raise rates, and, in fact, refused to do so at its most recent meeting.

Foreign investors could be spooked and try to pull their money out, reinforcing the currency drop and potentially leading to financial instability.

"When it comes to cornering Turkey to extract certain concessions that undermine our sovereign rights, it is a whole another story".

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