U.S. seeks to stab Turkey in the back: Turkey's president - USA

U.S. seeks to stab Turkey in the back: Turkey's president - USA

"Washington must give up the misguided notion that our relationship can be asymmetrical and come to terms with the fact that Turkey has alternatives", wrote the Turkish strongman in the New York Times on Saturday.

The yen slipped from highs as the dollar was helped by rises in U.S. bond yields. It fell as much as 12 percent at one stage on Monday, then recovered to a loss of 8.5 percent.

"We will respond to those who declared trade war on the entire world and included Turkey in it, by steering towards new alliances, new markets", he said, raising questions in the future partnership between Ankara and Washington. Many analysts say that isn't likely, but it's caused sharp losses for stocks.

"There is no economic reason for the present (currency plunge) situation".

Turkish President Recep Tayyip Erdogan says his country will boycott US -made electronic goods amid a diplomatic spat that has helped trigger a Turkish currency crisis.

Investors are anxious about a confluence of factors: the country's reliance on foreign loans that may stop flowing in as interest rates rise in other economies, like the U.S.; Erdogan's insistence that the central bank not raise interest rates, as most independent analysts say it should; and a spat with the U.S. that has led to sanctions and the fear of greater isolation from longtime allies in the West. Erdogan's refusal is one of several factors worrying investors.

More news: Erdogan warns of campaign against Turkey as lira plummets

The pan-European Stoxx Europe 600 index was down half a percent at 383.84 in late opening deals after declining 1.1 percent on Friday. The Argentine peso sank to an all-time low amid investor caution and a corruption scandal involving former government officials.

Last week, Goldman Sachs said in a research note that a depreciation of the lira to 7.1 to the dollar would erode Turkish banks' excess capital.

The lira rallied against the dollar on Tuesday morning from Monday's lows.

"What we can do is proved by what we have done so far". That suggests a stronger dollar, " he said. Japan's Nikkei rose 2.3 per cent and Australian stocks added 0.8 per cent. It hit a 10-week low to the yen around 125.45. Technology companies held up better. The Nasdaq composite fell 0.2 per cent to 7,819.71.

Earlier, the central bank pledged to provide liquidity and cut lira and foreign currency reserve requirements for Turkish banks. The freefall has been exacerbated by latest USA threat to double tariffs on Turkish steel and aluminum.

"Yes, the developments that are now going on in Turkey are causing great concern", Maas said. The lira is still down over 45% against the dollar so far this year.

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In corporate news, German conglomerate Bayer took a dive after a U.S. jury ruled against its Monsanto unit on Friday and awarded US$289 million to a former school groundskeeper who said that exposure to Monsanto's Roundup weed killer caused cancer.

Trading in Germany, Bayer tumbled 10.3 per cent.

These import taxes came on top of 10% additional tariffs on aluminum and 25% on steel from all countries, in a bid by Trump to protect the U.S. steel industry and please voters in America's industrial heartland.

"These things get very volatile in both directions once you have had a really big move", Saxo bank's head of FX strategy John Hardy said. The EU put new taxes on U.S. motorcycles in response to the Trump administration's tariffs on products imported from Europe.

Tensions between the US and Turkey, both North Atlantic Treaty Organisation allies, have reached new heights in the past week. Brent crude lost 0.3 per cent to US$72.61 a barrel in London.

More news: 'Boris has caused offence' over burqa remarks, says Theresa May

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