Turkish lira crisis poses additional risk to German economy

Galtero Lara
Agosto 21, 2018

The lira has tumbled some 40 per cent this year, hit by worries about Erdogan's influence over monetary policy and a worsening diplomatic rift with the United States. Nobody was hurt. A person was later detained, Anadolu news agency said.

President Tayyip Erdogan has resembled an attack on Turkey's economy to a strike against its flag or call to prayer, saying the campaign aims to bring "Turkey and its people to their knees".

Much of the recent tension has centered around a US evangelical Christian pastor, Andrew Brunson, who has been detained in Turkey on terrorism charges, which he denies.

He said: "We tell them that we see their game and we challenge them".

Turkish President Recep Tayyip Erdogan on Saturday called bluff on the Trump administration for threatening his country with sanctions.

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Last week, Trump has said he had doubled the tariffs on aluminum and steel tariffs from Turkey, prompting Ankara to sharply hike tariffs on several U.S. products.

The lira weakened to 6.1100 to the dollar at 0843 GMT, from a close of 6.0100 on Friday.

Despite such risks, the German economy remains buoyant, supported by state spending, private consumption, low interest rates, a robust labour market and rising real wages, the ministry said in the report.

"Turkey claims that the measures are inconsistent with a number of provisions of the WTO's Agreement on Safeguards and the General Agreement on Tariffs and Trade (GATT) 1994", said a statement on the WTO's website.

That came days after Qatar's emir approved a $15-billion package of economic projects, investments and deposits for Turkey.

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