Turkey’s lira steadies amid Erdogan’s move to boycott U.S. electronic products

Turkey’s lira steadies amid Erdogan’s move to boycott U.S. electronic products

Tariffs have also been increased on goods such as cosmetics, rice and coal.

Turkish Vice President Fuat Oktay said on Twitter that the measures were in response to "the deliberate attack of the USA administration on our economy".

The Turkish lira plummeted to a record low on Monday, losing almost 40 percent of its value since the start of 2018.

The diplomatic dispute has sent shockwaves through financial markets across the world as the plunging lira causing currencies in other developing countries to nosedive.

Turkey is boosting tariffs on imports of certain USA products, including rice, cars, alcohol, coal and cosmetics - escalating a feud with the United States that has helped trigger a currency crisis.

The call from businesses came as Erdogan demanded a boycott of Apple and other US -made products in an effort to hurt the United States.

President Donald Trump had previously announced that the United States was doubling steel and aluminium tariffs on Turkey, as the two North Atlantic Treaty Organisation allies row over the detention by Turkish authorities of American pastor Andrew Brunson.

Turkish President Recep Tayyip Erdogan vowed to boycott American electronics, including Apple Inc.'s iPhone, as he retaliates against Donald Trump's attempts to isolate his economy. He suggested Turks would buy local or Korean phones instead, though it was unclear how the boycott would be enforced or encouraged.

U.S. Charge d'Affaires Jeffrey Hovenier talks to members of the media after visiting United States pastor Andrew Brunson, who is being held under house arrest in Izmir, Turkey, Tuesday, Aug. 14, 2018.

"We have already seen some effect on the European banks and the euro because of that".




The newspaper also quoted a government undersecretary as saying that Turkey's Financial Crime Investigation Board "started an investigation into people and institutions that spread fake news" meant to undermine the lira-dollar exchange rate. But Erdogan's threat underlines that the standoff over the fate of an American pastor held in Turkey is unlikely to end soon.

While the economic penalties would probably do little to dent USA economic interests, Erdogan's threat shows that the standoff over the fate of an American pastor held in Turkey isn't going to end soon.

The United States imposed sanctions on two Turkish ministers and doubled customs tariffs on Turkish aluminum and steel imports after Brunson was placed in house arrest.

On Wednesday, the lira traded at 6.4125 to the USA dollar, weakening from a close of 6.3577 a day earlier.

Brunson, who has lived in Turkey for 20 years and has been detained since October 2016, is accused of helping Gulen's network and the proscribed Kurdistan Workers Party (PKK).

In an effort to defend the lira, Turkey's central bank tightened its rules on currency swaps and other foreign exchange transactions, limiting banks' ability to supply lira to foreign financial companies.

USA national security adviser John Bolton on Monday met Turkey's ambassador to the United States to discuss Brunson's detention.

"Significantly more than just official promises of action are needed to exit the current crisis", said Andy Birch, principal economist at IHS Markit, calling for "a sharp central bank rate rise".

Qatar and Turkey are bound by strategic relations at the political, economic and military fronts.

The war of words between Turkey and the United States has escalated significantly in the past week as the U.S. calls for the release of an American evangelical pastor.

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