Erdoğan urges Turks to sell dollars and euros to support lira

An investor looks at an electronic board showing stock information at a brokerage house in Shanghai China. Aly Song Reuters  File

An investor looks at an electronic board showing stock information at a brokerage house in Shanghai China. Aly Song Reuters File

On Saturday, Turkish president Recep Tayyip Erdogan warned the U.S. that it could lose a "strategic partner", declaring a rally: "We only bow before God.

On Friday the currency dropped as much as 18% at one point, the biggest one-day fall since a 2001 financial crisis in Turkey.

Waves from the crisis spread overseas, with investors selling off shares in European banks with large exposure to the Turkish economy. U.S. stocks were also rattled.

The lira tumbled 14 percent Friday, to 6.51 per dollar, a massive move for a currency that will make Turkish residents poorer and further erode worldwide investors' confidence in the country.

In a Twitter post on August 10, the USA president also referenced the rapid decline of the North Atlantic Treaty Organisation ally's national currency against "our very strong dollar".

Reuters Turkey's president, Recep Tayyip Erdogan, listens during a news conference with British Prime Minister Theresa May in London, U.K., May 15, 2018. While many of Turkey's challenges are specific to that country, there are certain characteristics - a heavy debt load following a prolonged, low United States interest-rate driven borrowing binge in dollars - broadly shared throughout emerging markets.

Erdogan said Turkey acted in accordance with the law, saying: "We have not made concessions on justice so far, and we will never make any".

"Aluminum will now be 20% and Steel 50%", President Trump wrote. "Because this is the language they understand", he said.

Erdogan said high foreign exchange rates were being used as a weapon against Turkey.

He also said Turkey had alternatives, "from Iran, to Russian Federation, to China and some European countries".

"The US runs the risk of losing Turkey as a whole", he wrote.

Turkey was hit by a financial shockwave this week as its currency nosedived over concerns about the government's economic policies and a trade dispute with the United States.

He also repeated his call to Turks to sell their dollar and euro savings to shore up the lira.

He reiterated his call on citizens to change US Dollars and Euros for the Turkish Lira in the face of a sharp plunge his country's currency witnessed in financial markets this week.

Trump said in a post on Twitter.

Despite Trump's insistence, Turkey has not budged in freeing American pastor Andrew Brunson, who has been detained by Turkey for nearly two years on charges that he was working with a terrorist organization and was a spy.

Ankara wants the United States to extradite Fethullah Gulen, a Pennsylvania-based cleric who Turkish authorities say masterminded the 2016 coup attempt in which 250 people were killed. Brunson has been detained for the past 20 months on accusations that he supported groups the Turkish government deems terrorists.

His cause resonates with Trump's Christian conservative supporters, who could be influential as Republicans seek to retain control of Congress in midterm elections in November.

Trump's action on Friday indicates he is willing to use his presidential powers as an economic and diplomatic weapon, even against allies, the Wall Street Journal reported. He offered no further details.

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