Turkish lira hits record low after U.S. says reviewing duty-free access

  06 August 2018    Read: 1333
Turkish lira hits record low after U.S. says reviewing duty-free access uk.businessinsider.com

The Turkish lira reached a record low against the dollar on Monday, after the Trump administration said it was reviewing Turkey’s duty-free access to the U.S. market, a move that could affect some $1.66 billion of Turkish imports.

The review by the U.S. Trade Representative’s office, announced on Friday, came after Ankara imposed retaliatory tariffs on U.S. goods in response to American tariffs on steel and aluminum.

Relations between the NATO allies have steadily worsened, strained by differences over Syria policy and an escalating row over the trial in Turkey of an American Christian pastor, Andrew Brunson. That friction has exacerbated the sell-off in the lira.

The currency has lost a quarter of its value this year, battered mainly by concerns about President Tayyip Erdogan’s drive for greater control over monetary policy. On Monday, it touched a record low of 5.14 against the dollar by 0809 GMT.

The U.S. Trade Representative’s office said the review could affect $1.66 billion worth of Turkish imports into the United States that benefited from the Generalised System of Preferences programme last year, including motor vehicles and parts, jewelry, precious metals and stone products.

It was unclear whether any large, listed Turkish firms would be hit by the move. Most auto parts suppliers tend to be smaller, unlisted companies. Stocks largely shrugged off the move, with Istanbul’s main stock index down 0.6 percent.

A USTR spokeswoman said the review was unrelated to issues surrounding Brunson, - a case that has prompted U.S. sanctions against two Turkish cabinet ministers.

Erdogan said on Saturday the sanctions by Washington against his ministers were disrespectful and that Turkey would retaliate by freezing assets of U.S. interior and justice ministers .

Bilateral relations have plummeted over the fate of Brunson, who was held in a Turkish prison for 21 months until he was transferred to house arrest.

 

Reuters


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