Will respond to US sanctions: Turkey

ISTANBUL: Turkey on Friday threatened to respond if the US levied further sanctions over the detention of an American pastor which has sparked a diplomatic standoff and battered the Turkish currency.

As Turkey’s government sought to reassure markets after the lira had been sent into a tailspin by the deepening spat, Washington said the next raft of sanctions could be on the way.

US treasury secretary Steven Mnuchin warned on Thursday that the United States would impose more sanctions unless pastor Andrew Brunson, described by President Donald Trump as a “hostage”, was released.

Turkey’s trade minister Ruhsar Pekcan responded to the new threat on Friday.

“We’ve already responded based on the World Trade Organisation rules and will continue to do so,” Pekcan was quoted as saying by the state-run Anadolu news agency.

Brunson’s detention since October 2016 on terror-related charges has soured relations between the two Nato allies and sent the lira tumbling.

The lira, which earlier this week traded at well over seven to the dollar, had rebounded slightly over the last three days but on Friday it lost nearly 5% of its value and was quoted at 6.1 against the dollar.

Analysts say sharp hike in interest rates is needed to stop the declining value of lira, but Erdogan’s government is opposed to any rate hike in order to stimulate growth. AFP