ISTANBUL: The Turkish lira weakened on Wednesday after Bloomberg said the United States is considering sanctions that could target Turkish defence companies, cutting them off from the US financial system over Ankara’s purchase of a Russian defence system.
Ankara and Washington have sparred publicly for months over the S-400 missile systems, expected to be delivered to Turkey as early as next month. Washington has said that would trigger US sanctions under CATSAA, a law calling for sanctions against countries procuring military equipment from Russia.
The lira stood at 5.8750 against the dollar at 0633 GMT, weakening from Tuesday’s close of 5.8265. Earlier, it weakened as far as 5.9250.
The most severe package under discussion would all but cripple the already troubled Turkish economy, Bloomberg reported three people familiar with the matter as saying.
The idea with the most support for now is to target several companies in Turkey’s defence sector with sanctions that would effectively sever them from the US financial system, making it almost impossible for them to buy American components or sell their products in the US. — Reuters
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