ISTANBUL (Reuters) – The Turkish lira firmed on Tuesday as investors bet on an easing in Turkey-U.S. strains after U.S. Secretary of State Mike Pompeo said he expected talks with Turkish officials this week over the fate of a U.S. pastor on trial in Turkey.
The lira has lost nearly 40 percent of its value against the U.S. currency this year on concerns over President Tayyip Erdogan‘s grip on monetary policy and, more recently, due to a diplomatic row between Turkey and the United States.
In August, U.S. President Donald Trump slapped additional tariffs on Turkish imports over its trial of evangelical pastor Andrew Brunson on terrorism charges. Turkey responded in kind, raising tariffs on some U.S. imports.
Erdogan is visiting the United States this week to attend a United Nations meeting. Secretary of State Mike Pompeo said on Monday that he expected talks with Turkish officials this week, during which Brunson’s fate will be discussed.
The lira <TRYTOM=D3> firmed to 6.0800 against the dollar by 0623 GMT, compared to a close of 6.1600 on Monday.
The row between Ankara and Washington helped send the lira to a record low of 7.24 against the greenback in August. The currency has since rebounded with a series of measures taken to prop up the lira, including a 6.25 percentage point rate hike by the central bank and a new economy programme announced by the government.
Turkish presidential spokesman Ibrahim Kalin told reporters in New York on Monday that Turkey’s judiciary would make a decision on Brunson and urged everyone to respect the court’s ruling.
Brunson’s next trial is set to take place on Oct. 12.