Washington has imposed financial sanctions on two Turkish ministers and doubled steel and aluminum tariffs on Turkey, as U.S. President Donald Trump tries to secure the release of Andrew Brunson, a 50-year-old American pastor being tried in Turkey on espionage and terrorism-related charges.
Turkey is in the throes of a full-blown currency crisis, with the Turkish lira losing almost 45 percent of its value since the start of the year.
Last month, a Turkish court ordered Brunson's release from prison but placed him under house arrest, prompting a furious reaction from the Trump administration, which had demanded that he be allowed to return to the United States. Two Turkish business lobbies and the heads of two banks increased pressure on the government and central bank to act to stem a slide that saw the lira lose more than a quarter of its value in less than two weeks.
On Tuesday, the lira recovered some ground, trading at 6.3300 to the dollar at 1947 GMT, up some 9% from the previous day's close and having earlier touched 6.2995.
A treasury desk trader at one bank said this showed relations with the European Union could recover "while tense relations continue with the U.S.".
Tim Ash, an analyst from Bluebay Asset Management, wrote in a client note: "Remarkable turnaround". What this does is prevent investors, like hedge funds, from accessing lira liquidity in the offshore swap market.
Samsung Investing $20 Billion In Futuristic Technologies
Samsung has been beefing up its contract drug making operations to help counter a potential decline in its mainstay electronics businesses.
California wildfires raging perilously close to thousands of homes
Three firefighters suffered minor injuries battling the flames, which have charred more than 18,000 acres (7,280 hectares). Several fires are burning throughout California, including one that is the largest fire in the Golden State's history.
Future bright for Woods after PGA, but Koepka is in the way
Tiger Woods once again challenged for his first major championship in ten years when he finished second at the PGA Championship . Even with 17 players separated by three shots at one point on the front nine, everyone had to catch Koepka , Woods included.
The country's finance minister - who is also Mr Erdogan's son-in-law - will seek to reassure around 1000 global investors in a teleconference scheduled for Thursday. A Finance Ministry official said so far 3,000 people have signed up for the call.
Salim bin Mubarak Al Shafi, Qatar's ambassador to Turkey, said his country would continue to support Turkey, adding that the emir's visit demonstrated the "depth" of the two countries' relations.
The decree will raise tariffs on American auto imports by 120-percent, alcohol by 140-percent and tobacco by 60-percent.
The extra tariffs apply to imports of vehicles, alcohol, coal, rice and cosmetics. The decision shows Turkey giving a proportionate response to American "attacks" on the Turkish economy, Vice President Fuat Oktay said in a tweet.
The standoff between the two North Atlantic Treaty Organisation allies has escalated quickly since Trump slapped sanctions on the interior and justice ministers on 1 August, following that move with tariffs on Turkish steel and aluminum imports last week.
Turkey's steel exports were valued at $11.5 billion a year ago, accounting for 7.3 percent of its total exports worth $157 billion, according to the Turkish Steel Exporters Association. Turkey's exports to the United States previous year amounted to $8.7-billion, making it Turkey's fifth-largest export market. President Trump and Erdogan were on relatively good terms before this latest spat, as the American president has even congratulated the Turkish authoritarian for consolidating power.
A higher Turkish court was still considering the appeal and Brunson's lawyer, Ismail Cem Halavurt, told CBS News on Wednesday that he would not consider the appeal formally rejected until the higher court issues it's ruling.