Germany, Qatar vow support for Turkey amid U.S. pressure

Those hoping to exchange liras in Istanbul were dismayed as the currency fell in response to remarks by the US president

Those hoping to exchange liras in Istanbul were dismayed as the currency fell in response to remarks by the US president

Washington's move came during an ongoing dispute over Turkey's holding of an American pastor for two years on charges of military espionage and spying for terror groups.

The tensions and the tariff hike by the U.S. have caused the Turkish lira to bleed value, fanning fears the country is on the verge of an economic crisis that could spillover into Europe.

Turkey doubled tariffs on some US imports including cars, alcohol and tobacco on Wednesday in retaliation for USA moves, but the lira rallied a further six per cent after a fresh move by banking authorities to underpin the currency.

U.S. President Donald Trump and Erdogan, seen on July 11, have appeared to get on well personally, but the North Atlantic Treaty Organisation allies have several areas of economic and political conflict.

Tariffs were also increased on other USA goods, including cosmetics, rice and coal.

The United States was the fourth largest source of imports to Turkey previous year, accounting for $12-billion of imports, according to International Monetary Fund statistics.

Chanting "Damn America", they unfurled a banner saying "we will win the economic war", the Demiroren agency said.

Turkey's President Recep Tayyip Erdogan announced that the country of 81 million people will boycott American consumer electronics, including Apple's iPhone.

Some 3,000 investors registered to join Albayrak's planned tele-conference, the private NTV broadcaster reported.

It recovered a bit, by four per cent to around 6.12 lira per US dollar Wednesday, after the government took steps to shore up the currency by reducing the daily limit in bank foreign currency swap transactions.

Turkey needs to reconcile with the United States in order to stop the ongoing depreciation of the Turkish lira, which is unlikely to be possible without the release of detained U.S. pastor Andrew Brunson.

Turkey Doubles Tariffs on some US Imports, Turkish Lira Rallies
Turkish President Tayyip Erdogan meets with Emir of Qatar Sheikh Tamim bin Hamad al-Thani in Ankara, Turkey August 15, 2018. Last Friday, US President Donald Trump said he had authorized higher tariffs on aluminum and steel imports from Turkey.

Markets have been concerned by Erdogan's influence over the economy and his resistance to interest rate increases to tackle double-digit inflation.

"They wait in queues for long time in front of the cash points", she said, noting that 100 dollars can buy at least five items now, up from three pieces last week.

Investors, though, continue to demand higher interest rates - something the central bank may struggle to deliver because it's been under constant pressure from Erdogan to do just the opposite.

As a court in the western Turkish city of Izmir rejected a new appeal to free Brunson on Wednesday, spoksman Kalin said the U.S. needs to be respectful of the judicial procedures in Turkey.

The announcement came after Qatar's emir Sheikh Tamim bin Hamad Al-Thani held lunchtime talks with Turkish President Recep Tayyip Erdogan.

Qatar pledged on Wednesday 15 billion (Dh 55bn) of direct investment into Turkey, amid a diplomatic spat between Ankara and Washington that has triggered a Turkish currency crisis.

Turkish officials have also emphasised that Ankara wants to retain strong ties with Europe, which has also expressed deep unease with Trump's trade policies.

Earlier on Wednesday, Erdogan spoke on the phone with German Chancellor Angela Merkel, the Turkish presidency.

There was also optimism about better relations with the European Union after a Turkish court released two Greek soldiers pending trial.

Brunson, who has lived in Turkey for over two decades, is accused of aiding the network of US-based cleric Fethullah Gulen, blamed by Erdogan for masterminding a failed coup in 2016.

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