Trump's new tariffs on Turkey are actually benefiting Russian Federation

Berat Albayrak

Relations between the US and Turkey have deteriorated further this week as US President Donald Trump raised tariffs against Turkish aluminium to 20% and to 50% in terms of steel.

Trump tweeted that the latest tariff decision came as Turkey's currency, the lira, "slides rapidly downward against our very strong Dollar".

Erdogan, with his article in the New York Times, said that Ankara might seek new allies.

Mr Erdogan has linked Gulen's fate to that of American Christian pastor Andrew Brunson, who is on trial in Turkey on terrorism charges for allegedly supporting a group that Ankara blames for the failed coup.

In July, US President Donald Trump threatened to impose large sanctions on Turkey if he refused to free Brunson, and on 1 July announced economic punishments against Turkish Justice Ministers Abdulhamit Gül and Interior Minister Suleyman Soylu.

The currency is currently down 13.5% against the U.S. dollar, after a brief 20% fall, resulting from a Trump tweet that declared, "Aluminum will now be 20% and Steel 50%", and concluded: "Our relations with Turkey are not good at this time!".

Putting a 50 percent tariff on a foreign country's steel exports isn't the most conventional way to secure an imprisoned American's relief.

Early on Friday, the lira hit a new record low, plunging to as far as 6 per USA dollar after a Turkish delegation returned from talks in Washington on Thursday with no apparent solutions to an ongoing crisis.

Erdogan has further attempted to bolster the nation against this "economic war", calling for citizens to exchange foreign currency and gold for lira as part of the "domestic and national struggle".

The currency's drop - 41 percent so far this year - is a gauge of fear over a country coming to terms with years of high debt, global concern over Erdogan's push to amass power, and a souring in relations with allies like the U.S. Trump said in an early morning post on Twitter. On Friday, he said the country had to take steps in answer "to those who have waged an economic war against us".

He urged Washington to give up the misguided notion that bilateral relations could be "asymmetrical" and realize that Turkey had alternatives "before it is too late".

Trump's move sent Turkey's lira currency and its stock market deeper into tailspin.

"Shame on you, shame on you", he said in remarks directly addressed to Washington. Erdogan said Turkey would be looking to form alternative economic alliances with "Iran, to Russian Federation, to China and some European countries". He says higher interest rates lead to higher inflation, the opposite of what standard economic theory says. Its currency is plunging and Turkey is also in a diplomatic spat with the US, a major trading partner.

Silence from the central bank has highlighted investor fears over the institution's independence from Erdoğan, who was sworn in last month with wider executive powers that many worry will be used to wield greater influence over monetary policy.

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