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Turkey is a 'target of economic war', says Tayyip Erdogan

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Turkey is a 'target of economic war', says Tayyip Erdogan

In an op-ed published in New York Times, Erdogan warned Washington not to risk its relations with Ankara, saying otherwise it would look for "new friends and allies".

Speaking to a crowd in his hometown of Rize on Saturday, Erdogan addressed the recent U.S. decision to sanction two Turkish officials over the detention of American pastor Andrew Brunson, who has been held in Turkey since 2016 over claims that he was linked to the failed coup attempt in July of that same year.

A Turkish court has agreed to move Brunson from prison to house arrest over health concerns, but it still does not allow him to return to the United States.

Turkey's currency slumped to a new record low as Donald Trump compounded the country's economic crisis by doubling steel and aluminium tariffs.

Against the dollar, the lira has lost 35 percent of its value this year, and Donald Trump announced new higher tariffs for Turkey amidst the tensions.

Trump tweeted that he had authorized the doubling of steel and aluminum tariffs "with respect to Turkey".

Trump's tweet caused a further drop in the Turkish currency, which is now down 13 percent on the day.

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

In 2017, 19 billion dollars worth of goods were traded between the USA and Turkey.

Mr Trump intensified his spat with Turkey by imposing the higher tariffs, putting unprecedented economic pressure on a North Atlantic Treaty Organisation ally and deepening turmoil in Turkish financial markets.

He appeared to blame foreigners for trying to hurt Turkey, saying: "This will be my people's response against those waging an economic war against us".

Washington "must give up the misguided notion that our relationship can be asymmetrical", he said in the opinion piece.

"There was some hope that maybe they'd step back from the brink and you'd see a re-establishment of central bank independence", he said. "Hopefully we will overcome this disaster and we will also successfully overcome this economic war", Erdogan said.

The US this month imposed sanctions on two ministers over the pastor's detention, and talks to resolve the issue in Washington last week ended without result.

"We are preparing to trade in our local currencies with the countries that we have the largest trade volume such as China, Russia, Iran, and Ukraine".

After the US President's tweet, shares of Turkish steelmakers Kardemir and Erdemir plunged as much as eight percent and 9.9 percent respectively. The U.S. responded by slapping sanctions on Turkey and threatening more.

The lira, which had traded at 4 to the dollar as late as April, was being quoted at more than 7 to the dollar at one point Friday before rebounding to about 6.4.

The lira has always been falling on worries about Mr Erdogan's influence over monetary policy and worsening relations with the United States. Two days later, Secretary of State Mike Pompeo warned that Turkey that the "clock had run out" to release Brunson.

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