Turkish Lira Trades Lower as U.S.-Turkey Tensions Rise

Turkey’s currency is once again close to hitting new all-time lows against the dollar as tensions between the Trump and Erdogan administrations have ratcheted up.

The lira traded down 0.65% against the USD on Monday on comments from President Erdogan, who accused the Trump administration of waging a “psychological war” regarding the release of Pastor Andrew Brunson, an American who was arrested in Turkey in the aftermath of the failed coup in July of 2016.

President Erdogan’s accusation came in response to President Trump’s own threats of sanctions on Turkey:

The lira’s losses today small compared to the 3%+ daily crashes the lira suffered in the second week of July, however, today’s drop brings the lira closer to the 4.9734 level - the all-time low from July 12, 2018.

So far this year, and including Monday's losses, the lira has dropped approximately 29% versus the U.S. dollar:

American/Turkish flag image via Viktoria Pickering

Canadian Dollar, Mexican Peso Rise as Trump Auto Tariffs Delayed by New Bipartisan Bill

A bill aimed at delaying President Trump's tariffs on foreign automobiles, introduced by Republican Senator Lamar Alexander and Democratic Senator Doug Jones on Wednesday, gave the Canadian dollar a boost in the second half of the New York Forex session.

In the hours following the unexpected news, currency traders pushed the USD/CAD pair to a low of 1.3031 - a gain of almost 0.80% for the CAD on the day. At press time, the CAD is trading at a 40-day high against the USD.

According to Bloomberg, the bill puts the brakes on Trump's bold 25% auto tariff hike until an independent U.S. International Trade Commission examines the impact the tariffs would have on the American car market.

And Canada's currency wasn't the only beneficiary the bipartisan bill. The Mexican peso also got a boost following the news, closing the day off with a gain of 1.10% vs. the USD. Wednesday's gains also pushed the peso to its highest level (18.66 pesos to the dollar) since May 1, 2018.

Image Credit: Carol Van Hook