Turkey's lira was on the back foot on Friday after US President Donald Trump threatened to slap sanctions on Turkey unless it freed an American pastor, prompting an angry response from Ankara and escalating tensions between the two Nato allies.
The lira, which has lost a fifth of its value this year, has been battered by several concerns, particularly President Tayyip Erdogan's drive for lower interest rates. But difficulties with the United States, a major trading partner, have also weighed.
The Trump administration escalated pressure to free the pastor, Andrew Brunson, a day after a court ordered that he be moved to house arrest after 21 months in detention. He is on trial for terrorism charges, which he has denied. "The United States will impose large sanctions on Turkey for their long time detainment of Pastor Andrew Brunson, a great Christian, family man and wonderful human being," Trump tweeted.
The lira was at 4.8478 against the dollar, little changed from its close of 4.8555 on Thursday, when it weakened on news of the potential sanctions. The United States was Turkey's fifth-largest export market last year, accounting for $8.7 billion in exports, according to IMF direction of trade statistics.
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