Turkish lira weakens after Trump comment on economic devastation
Lira lost nearly 30% of its value against the dollar last year
Lira lost nearly 30% of its value against the dollar last year. PHOTO: REUTERS
ISTANBUL:
Turkey's lira weakened against the dollar on Monday after US President Donald Trump warned the United States would devastate Turkey economically if Ankara attacks a Washington-backed Kurdish militia in Syria.
The lira, which lost nearly 30% of its value against the dollar last year, eased to 5.53 against the US currency by 0736 GMT from a close of 5.4540 on Friday after touching 5.5450 in early morning trade.
President Donald Trump threatened Turkey with economic devastation if it attacks a US-allied Kurdish militia in Syria prompting response from Ankara warning for a fatal mistake.
Turkey vows to continue fight against Kurdish militia after Trump threat
"We see that the negative decoupling trend in lira that we observed last week strengthening today," an FX trader of a bank said. "Trump's statements are the main reason for it."
"The market follows the ties with the US and Syria process closely. Selling pressure might gain strength in case the relations between Ankara and Washington strains again."
Separately, data showed that industrial production fell for the third straight month a calendar-adjusted 6.5% year-on-year in November, a further indication that the economy slows down.
PM Imran Khan to leave for Turkey on January 3
The BIST 100 index was down 1.1% in the morning trade.
In August 2018, the Turkish lira weakened as ties with US deteriorated and US President Donald Trump authorised a doubling of duties on aluminium and steel imported from Turkey, triggering retaliatory measures from Ankara
Finance Minister Berat Albayrak warned that US trade sanctions against Ankara could destabilise the Middle East.
The row with Washington over an American evangelical Christian pastor detained in Turkey on terrorism charges aided the losses in lira.
Turkey's lira weakened against the dollar on Monday after US President Donald Trump warned the United States would devastate Turkey economically if Ankara attacks a Washington-backed Kurdish militia in Syria.
The lira, which lost nearly 30% of its value against the dollar last year, eased to 5.53 against the US currency by 0736 GMT from a close of 5.4540 on Friday after touching 5.5450 in early morning trade.
President Donald Trump threatened Turkey with economic devastation if it attacks a US-allied Kurdish militia in Syria prompting response from Ankara warning for a fatal mistake.
Turkey vows to continue fight against Kurdish militia after Trump threat
"We see that the negative decoupling trend in lira that we observed last week strengthening today," an FX trader of a bank said. "Trump's statements are the main reason for it."
"The market follows the ties with the US and Syria process closely. Selling pressure might gain strength in case the relations between Ankara and Washington strains again."
Separately, data showed that industrial production fell for the third straight month a calendar-adjusted 6.5% year-on-year in November, a further indication that the economy slows down.
PM Imran Khan to leave for Turkey on January 3
The BIST 100 index was down 1.1% in the morning trade.
In August 2018, the Turkish lira weakened as ties with US deteriorated and US President Donald Trump authorised a doubling of duties on aluminium and steel imported from Turkey, triggering retaliatory measures from Ankara
Finance Minister Berat Albayrak warned that US trade sanctions against Ankara could destabilise the Middle East.
The row with Washington over an American evangelical Christian pastor detained in Turkey on terrorism charges aided the losses in lira.