USA to Increase Tariffs on Turkish Aluminum, Steel

Turkish delegation returns home after meeting in US

I have just authorised a doubling of tariffs on steel and aluminium with respect to Turkey as their currency, the Turkish lira, slides rapidly downward against our very strong dollar!

Since then, its relationship with Turkey, the sixth largest steel importer to the United States, has deteriorated, prompting Ankara to send a delegation this week to Washington to meet with both the State and Treasury Departments.

The Turkish lira dropped as much as 18 per cent at one point after Mr Trump's announcement - the biggest one-day fall since a 2001 financial crisis in the country.

Fears over contagion even pushed global equity markets lower, with some European banks coming under heavy selling pressure due to their exposure to Turkey. But invoking national security is the only way to square Trump's policy with US law and WTO rules.

The lira, which has lost more than 40 percent this year, hit a new record low after Trump took steps to punish Ankara in a wide-ranging dispute.

Donald Trump said Friday his administration had doubled steel and aluminum tariffs on Turkey, imposing a 20 percent duty on aluminum and a 50 percent levy on steel.

The currency slid almost 8 percent in relation to the dollar to a record low of 6.59 shortly after Trump announced the increase on metals duties on Twitter. Lindsay Graham of SC, said Trump's decision was retaliation against Turkey for not releasing Brunson. "They keep lagging behind the curve and the pace of the depreciation and the penalty that the market inflicts on Turkey when it sells off is increasing at a more than linear pace, nearly exponentially". Financial upheaval there risks further destabilizing an already volatile region.

"Officials are reportedly preparing stimulus measures in a bid to prop up growth, but these would simply exacerbate Turkey's economic vulnerabilities and could ultimately tip the country into a full-blown crisis, " Capital Economics said in a commentary.

But Turkey's trade ministry said the tariffs were against World Trade Organisation rules.

The Turkish president took aim at the U.S. in his address, claiming "some countries have engaged in behaviour that protects coup plotters and knows no laws or justice". Gultekin hopes that some sort of compromise between Turkey and the USA can be reached, enabling Erdogan to have an "honourable exit" and come up with a substitute for the International Monetary Fund stabilisation programmes of previous crises.

Turkey delivers just 4 percent of steel mill imports, valued about $1.18 billion past year, according to the US Department of Commerce.

Turkey's President Recep Tayyip Erdogan addresses his supporters in Bayburt, Turkey, Friday, Aug. 10, 2018. "The tweet is mightier than the Turkish sword", Cristian Maggio, head of emerging markets strategy at TD Securities, said in a note to clients.

In an opinion piece in the New York Times on Friday, Erdogan said Turkey's partnership with the United States could be in jeopardy unless Washington "starts respecting Turkey's sovereignty".

On Thursday, Erdogan said "If they have their dollar, we have the people, we have Allah".

In many nations, including the U.S. and European Union states, the central bank is independent of government and no one can tell it what to do with interest rates.

Turkish authorities arrested Brunson in December 2016, claiming that he was a spy and was linked to a failed plot to overthrow the government. Gulen denies the allegation.

A statement from the White House confirmed the president's decision to pool reporters.

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