John Bolton meets Turkey's US ambassador

US National Security Adviser John Bolton and Turkey's ambassador to the US, Serdar Kilic, discussed the detention of Andrew Brunson "and the state of the US-Turkey relationship". PHOTO: REUTERS

WASHINGTON (Bloomberg) - National Security Adviser John Bolton met on Monday at the White House with Turkey's ambassador to the US, Serdar Kilic, as a collapse in Turkish financial markets rippled across emerging markets.

The meeting was convened at Kilic's request, according to the White House. It marked the first encounter announced between senior officials from the two governments since President Donald Trump ordered on Friday an increase in tariffs on Turkish steel and aluminium.

Tensions between the two NATO (North Atlantic Treaty Organisation) allies have intensified amid a dispute over the Turkish government's detention of an American evangelical pastor.

Turkey's president, Recep Tayyip Erdogan, has signalled defiance, saying the US "cannot tame" his country with threats and warning that Trump was risking the loss of a strategic ally.

White House press secretary Sarah Huckabee Sanders said in a two-sentence statement announcing the meeting that Bolton and Kilic discussed the detention of the pastor, Andrew Brunson, whom the Turkish government has accused of espionage and terrorism related to a 2016 failed coup attempt, "and the state of the US-Turkey relationship".

Trump doubled tariffs on imports of Turkish steel and aluminium last week, putting further pressure on the country's economy and markets. Turkey's lira has weakened into record territory as investors grew anxious about Erdogan's economic policies.

The lira led losses among global peers after the nation's first steps to bolster the financial system were seen by some analysts as insufficient to protect markets.

As Erdogan lashed out at the US, took higher rates off the table and said he wouldn't accept an international bailout, traders pushed down Turkish assets in a selloff that spilled over to other developing countries.

Trump announced on Friday morning that he was doubling tariffs on steel and aluminium imports from Turkey. That decision followed sanctions Trump imposed earlier this month on the country's justice and interior ministers.

The Turkish currency has lost about a quarter of its value against the dollar since Washington sanctioned the ministers.

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