Economy

Pakistan reiterates 'strong support' for Turkey after USA sanctions

Pakistan reiterates 'strong support' for Turkey after USA sanctions

"An investigation has been launched according to Turkish Penal Law, Banking Law, Capital Markets Board regulations and related laws into people who displayed actions that threaten economic security through manipulative stories on media and operational social media accounts as part of the economic attacks that target the Republic of Turkey, its social peace, unity and economic security by the powers behind the [2016] coup attempt", the prosecutor's office said in a statement on August 13, according to the state-run Anadolu Agency.

The lira lost about a quarter of its value against the dollar since the United States spat with President Recep Tayyip Erdogan's government over the continued detention of an American pastor worsened last week.

President Erdogan, meanwhile, dismissed the suggestion that Turkey was in a financial crisis, saying the lira's drop was the result of a plot.

The Turkish lira fell over 30 percent against the dollar last week amid an escalating dispute with US President Donald Trump over steel and aluminum tariffs and growing concerns about the health of the Turkish economy.

Turkey has pledged it will take action to calm markets after the lira plunged to a new record low in Asian trading.

The Turkish lira dropped as much as 11% against the dollar in morning trading in Asia.

President Recep Tayyip Erdogan on Sunday criticized the US, saying Turkey will say "goodbye" to those, who prefer terrorists as their strategic partner.

"I have respect for our president, but I can't sell my gold and foreign currency just because he made that call", said Mr Sevin Temur, a 58-year-old retiree. "With God's permission we will overcome this", he added.

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Eight years ago, concerns about contagion during the eurozone debt crisis saw investors push up the borrowing costs of highly indebted eurozone countries, exacerbating their debt problems. He also rejected capital controls as an option to stem outflows of hard currency and vowed to crack down on those he said were spreading damaging rumors that deposits would be seized. And Trump then hurled fuel on the flames with his tweet over the tariffs, prompting Friday's crash.

"You dare to sacrifice 81-million (in) Turkey for a priest who is linked to terror groups?" He is facing up to 35 years behind bars if found guilty.

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Several days later Erdogan accuses Washington of showing an "evangelist, Zionist mentality".

On July 18, ties take a turn for the worse when a Turkish court orders an American pastor, Andrew Brunson, held for nearly two years on terror charges, to remain in prison. He has urged the central bank to not raise interest rates.

Also caught up in the sell-off is Russia's ruble, which today hit its lowest level against the United States dollar since April 2016 and its lowest level against the euro since April this year, partly reflecting the high amount of borrowing in foreign currencies by Russian corporates, but also concern about the damage that the latest round of U.S. sanctions against Moscow - imposed in the wake of the Salisbury poisonings - will do to the country's economy.

LONDON - European markets started the week deep in negative territory before recovering a little over the course of Monday as the crisis over the Turkish lira drags on investor sentiment around the world.

Erdogan had on Saturday described interest rates as a "tool of exploitation", in remarks that may not be warmly welcomed by the markets. "Every outburst by Erdogan explodes on us".


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