Trump ramped up his attack on Turkey by doubling USA tariffs on Turkish aluminum and steel imports to 20 percent and 50 percent, respectively.
Andrew Brunson has been in Turkish custody since 2016, when he was arrested on charges of terrorism and support of a group held responsible for an attempted coup of Turkish President Recep Tayyip Erdogan.
Andrew Craig Brunson, an evangelical pastor from Black Mountain, North Carolina, arrives at his house in Izmir, Turkey, Wednesday, July 25, 2018. "Turkey has been trending towards authoritarianism & becoming more anti-American".
The currency has fallen 66 per cent since the start of the year, pushing up the cost of goods for Turkish people and shaking worldwide investors' confidence in the country. All week, the lira has been under pressure, which accelerated with the failure of diplomatic talks in Washington this week.
Belpointe Chief Strategist David Nelson on the potential global market impact from Turkey's financial crisis and the future of Tesla.
This suggests he is sticking to his nationalist message, for now at least, and may still resist delivering the hard measures Turkey desperately needs.
The 10-year yield slid below 2.9 percent as price data reinforced the Federal Reserve's rate-hike intentions and investors sought havens. "We will not lose the economic war", state-run TRT Haber television quoted Erdogan as saying. And it is not too far away from the level at which Goldman Sachs warned Turkey's banks would run out of the extra capital they had built up as a buffer against a crisis. The Treasury Department announced fresh sanctions on two Turkish government officials in response to Turkey's refusal to let Brunson go.
Erdogan's claim of a Western political plot against him sparked alarm in investors and prompted an acceleration in the currency sell-off.
The current market expectation is that a rate increase of at least 5pc, from the current 17.75pc interest rate, will be required to stem the tide of Lira losses and traders are nervously awaiting any announcement of an emergency central bank meeting which may happen next week.
Adding to investors' concerns, Erdogan pledged a continuation of his debt-fueled construction policy to boost the economy, which is blamed for Turkey's rampant inflation and has added to currency weakness. Trump, who had secured the release of a Turkish woman activist being held by Israel and just days earlier he had been exchanging fist bumps with Erdogan at a North Atlantic Treaty Organisation summit in Brussels, took it as a personal affront.
Turkey's currency slumped to a new record low as Donald Trump compounded the country's economic crisis by doubling steel and aluminium tariffs.
Donald Trump has today announced massive increases to tariffs against Turkey as its currency the lira continues to plummet.
He told supporters to "change the euros, the dollars and the gold that you are keeping beneath your pillows into lira at our banks".
Turkey's economy is regarded as fragile because of its high debt, which the worldwide Monetary Fund estimates is 50 percent of its gross domestic product.
Mr Erdogan also remained defiant, as he urged the Turkish people to exchange foreign currency or gold for lira.
"I don't think foreign banks will be willing to lend to Turkish banks".
Kinder Morgan Inc, the second largest North American pipeline operator, had already ordered almost half of the specialized pipe needed for its Gulf Coast Express project from Turkish steel maker Borusan Mannesmann before the original tariff went into effect, spokeswoman Sara Hughes said.