Published: Fri, August 17, 2018
Money | By Hannah Jacobs

Euro nudges higher as US-China trade talks calm market nerves

Euro nudges higher as US-China trade talks calm market nerves

The U.S. wants American evangelical pastor Andrew Brunson freed and cleared of terrorism-related charges he has faced since 2016, when Turkish authorities arrested him for allegedly aiding a failed coup attempt earlier that year. The dollar's stalling near its multi-month high came while President Donald Trump praised its recent strength on Thursday, even though he had said a strong greenback puts US exporters at a disadvantage. He did not elaborate on what measures the U.S. is willing to take if Turkey continues to play hardball over Brunson.

United States treasury secretary Steven Mnuchin yesterday said to Mr Trump that further sanctions are ready to be put in place.

The White House said Wednesday that the United States "won't forget" how Turkey treated Andrew Brunson, the detained American pastor, after a court rejected his appeal for release.

Following the announcement, the lira firmed briefly to 5.8699 from 6.04 to the USA dollar, but later eased back to 6.0200 at 1538 GMT.

Before he spoke, the lira strengthened more than 3 per cent, despite signs that the rift with the United States is as wide as ever.

Doubts about Turkey's future intensified as relations with the United States, a longtime North Atlantic Treaty Organisation ally, soured. -China trade relations helped markets recover Thursday after officials said they would hold lower-level talks later this month on the trade dispute. "Not fair, not right".

Trump, who doubled steel and aluminum tariffs on Turkey, said the steel tariffs have kicked in the aluminum tariffs will take effect soon.

Turkey has proven a key ally for Qatar over the past year, helping the tiny Gulf nation ride out a more than 14-month blockade by its powerful neighbors, including Saudi Arabia, with which it shares its only land border.

"Commodities weakening tells us [investors] aren't overly optimistic on the rebound potential of China", said Matthew Miskin, market strategist at John Hancock Investments.

The Turkish lira built upon Wednesday's gains, when Qatar pledged to invest $15 billion in Turkey.

He also urged Brunson to serve as a "great patriot hostage" while he is jailed and criticized Turkey for "holding our wonderful Christian Pastor".

Tensions between Turkey and the U.S. have been on the rise as Trump has pressed for the release of the pastor.

The two North Atlantic Treaty Organisation allies have traded tit-for-tat sanctions over the pastor's house arrest.

In an intensifying cycle of tensions with the United States, Erdogan has called for a boycott of U.S. electronic goods such as iPhones and Ankara has sharply hiked tariffs on some USA products.

Turkey's finance minister sparked a recovery in the lira yesterday after he addressed thousands of global investors on a conference call.

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