Turkey’s plunging currency is stoking anxieties on Wall Street and throughout global markets.
On Sunday — early Monday in Asia — the Turkish lira put in fresh lows against the U.S. dollar, down more than 8% in Asian trading hours, after what had been a plodding descent in the first eight months of 2018 culminated in a death spiral Friday, wiping out some 14% of the currency’s value against greenback.
Most recently, one dollar changed hands at 6.9890 lira USDTRY, +9.0331% , compared with 6.4275 lira late Friday in New York, a drop of 8.7%, according to FactSet data. At its lows late Sunday, Eastern time, one dollar bought about 7.1310, an 11% tumble intraday.
The currency crisis in Ankara took a turn for the worse Friday after President Donald Trump, via Twitter, said that he authorized the doubling of steel and aluminum tariffs against the country. Turkey already is under U.S. sanctions for its detention of U.S. evangelical pastor Andrew Brunson, who is being held on espionage charges.
During a rally over the weekend, Turkey’s outspoken leader President Recep Tayyip Erdogan struck a defiant tone against the U.S. and Trump’s recent tariff threats against what the Turkish leader described as an important ally in the North Atlantic Treaty Organization.
I have just authorized a doubling of Tariffs on Steel and Aluminum with respect to Turkey as their currency, the Turkish Lira, slides rapidly downward against our very strong Dollar! Aluminum will now be 20% and Steel 50%. Our relations with Turkey are not good at this time!
— Donald J. Trump (@realDonaldTrump) August 10, 2018
“You cannot tame our people with threats,” Erdogan said Saturday, during a series of speeches that