Turkey Financial Crisis: Stocks at Record Low as Lira Plunges Again

Turkey Financial Crisis: Stocks at Record Low as Lira Plunges Again

Turkey Financial Crisis: Stocks at Record Low as Lira Plunges Again

Turkey's President Recep Tayyip Erdogan has said his country will boycott USA electronic products, after Washington imposed punitive sanctions on Ankara.

"We will boycott USA electronic goods", Erdogan said in a speech in Ankara, again showing no sign of compromise in the dispute.

Santosh Rao, head of research at Manhattan Venture Partners, said Erdogan's move to boycott American electronics and push Turkish consumers to Vestel phones might not work the way he thinks it will.

"If [people currently] have iPhone, there is Samsung on the other side", President Recep Erdogan said in a speech at a Symposium in Ankara, the country's capital city. Most economists say Erdogan should raise interest rates to support the Turkish lira, but Erdogan wants to keep rates low to support growth. "The drop by the Turkish lira may have stopped, but the country is yet to tackle the fundamental problems facing it, and this has kept market sentiment subdued", said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management in Tokyo.

The call for a boycott appears to be Erdogan's answer to the US decision to double tariffs on Turkish steel and aluminum imports. The lira has lost more than 40 percent of its value against the dollar this year, hit by worries over President Tayyip Erdogan's calls for lower interest rates and fraying ties with the United States.

While the economic penalties would probably do little to dent US 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. But Erdogan's threat underlines that the standoff over the fate of an American pastor held in Turkey is unlikely to end soon.

The dollar advanced to a 13-month peak on Tuesday against a basket of major currencies as traders increased their safe-haven holdings of the US currency on worries about the fallout from the Turkish lira's recent fall.

Last month, a Turkish court ordered Brunson's release from prison but placed him under house arrest, prompting a furious reaction from the Trump administration, which had demanded that he be allowed to return to the United States.

Trump's announcement came shortly after Erdogan called on Turks to help defend the country against the US-launched economic war on his nation.

What are the implications of the crisis in Turkey, at home and overseas?

As Turkey's currency started dropping, President Donald Trump announced that the USA would be doubling its tariffs on imports of Turkish steel and aluminum.

But she told Lynch, what could turn things around as far as investors are concerned is German Chancellor Angela Merkel's urging of Turkey to ensure the independence of its central bank at a Monday news conference.

He also said tangible and effective reforms will be the most important part of Turkey's economic policy in the coming period. However, the lira recovered some ground on Tuesday, trading at 6.60 to the dollar, up around five percent on the day, after having crashed to an all-time low on Monday.

He and his lawyers have denied those allegations, and the USA has said the charges aren't credible. Mr Brunson, who faces up to 35 years in jail if found guilty, denies the charges.

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