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Recep Tayyip Erdogan moves to boost economic ties with Europe, Middle East

Erdogan's overtures to Europe suggest he's prepared to mend ties strained by past diplomatic clashes

Bloomberg  |  Dubai 

TurkeyPresident Tayyip Erdogan
Turkey President Tayyip Erdogan. Photo: Reuters

Turkish President Recep moved to shore up alliances in and the Middle East, easing pressure on the battered lira, as the stand-off between Turkey and the US deepened.

Efforts to rally support and bolster domestic markets include a call Thursday between Turkish Finance Minister Berat Albayrak and investors. Erdogan also spoke with French President Emmanuel Macron, a day after talks with German Chancellor Angela Merkel and a $15 billion pledge of support from Qatar.

The lira climbed for a third day along with emerging-market currencies even after the White House said new would remain regardless of whether Andrew Brunson, an American pastor detained in Turkey, was freed. Helping support the currency, the central bank didn’t offer any funding through its one-week repo rate at 17.75 per cent for a fourth day, forcing lenders toward its more expensive overnight rate of 19.95 per cent.

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"The bigger issue for markets is this constant politicisation of economic and financial issues," said Mohieddine Kronfol, the Dubai-based chief investment officer for global sukuk, and North Africa fixed income at Franklin Templeton Investments.

Erdogan’s overtures to suggest he’s prepared to mend ties strained by past diplomatic clashes -- he accused Merkel’s government of engaging in "Nazi practices" last year -- in an attempt to weather the U.S. pressure. The pledge by Qatar, on the other hand, rewards the president for standing by the gas-rich Gulf country against a Saudi-led boycott backed by U.S. President Donald Trump.

First Published: Thu, August 16 2018. 23:22 IST