On Friday, Trump announced that the U.S. will impose a 20 percent duty on aluminum and 50 percent one on steels as tensions mount between the two North Atlantic Treaty Organisation allies over Ankara's imprisonment of USA pastor Andrew Brunson.
The President said he had authorised higher tariffs on imports from Turkey, imposing duties of 20 percent on aluminium and 50 percent on steel.
It added that Trump's comments, made on Twitter, were "not possible to reconcile with state seriousness".
On March 1, Trump had announced global tariffs of 10 percent on all aluminum to the US and 25 percent on all steel imports. European and American bank stocks declined on concerns about their exposure to Turkey.
Turkey is now under a 25 percent tariff on imported steel and 10 percent on aluminum, which went into effect in March.
A widening rift with the United States, its main North Atlantic Treaty Organisation ally, and President Tayyip Erdogan's grip on monetary policy under a new powerful executive presidency have helped to drive the lira down by more than 40 percent this year, a particular vulnerability for Turkish banks as over a third of their lending is in foreign currencies.
While it was true USA sanctions on a few top Turkish officials over an American pastor being detained had put more pressure on the lira this past week, this was far from the main reason their currency has been falling so fast.
The lira, which has lost a third of its value this year, fell on his comments and was trading at around 6.05 to the dollar after he spoke, almost 9 percent weaker on the day.
UBS chief economist for EMEA emerging markets Gyorgy Kovacs said a giant rate hike of 350-400 basis points would be "consistent with real rate levels that in the past helped to stabilise the currency" but warned a deal to normalise ties with the U.S. may also be needed. "It just shows the importance of the evangelical vote in the U.S.as it heads to midterms".
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On Friday, they also had to also factor in Turkey's economic crisis. Rate increases are the central bank's main tool to support the currency and fight inflation.
"We think that Turkey has a toxic combination of a weak external position (current account deficit), excessive private sector debt and a high level of foreign funding in the banking system".
The euro EUR=EBS dropped below technical support at $1.15 to $1.1393, down 1.15 percent on the day and the lowest since July 2017.
Turkey's sovereign dollar-denominated bonds tumbled with many issues trading at record lows. Because the dollar is the first, or base, currency in the USD/TRY currency pair, the sharp rise on the chart illustrates the dramatic weakening of the lira against the dollar.
"Don't forget", he said, "if they have their dollars, we have our people, our God".
A USA official, speaking on condition of anonymity, told The National that the tariffs decision was among a number of options presented to Mr Trump.
High-level meetings in Washington between USA and Turkish officials over Brunson ended this week, apparently without a resolution.
Erdogan had raised eyebrows Thursday when he appeared to invoke divine intervention, saying: "If they have dollars, we have our people, we have our right and we have Allah!"
It was reported that Erdogan's son-in-law and Turkey's new finance minister, Berat Albayrak, were set to unveil a "new economic model" on Friday, but the announcement did little to reassure investors.
Economic experts believe the sharp fall of the lira is mainly because of concerns about the government's economic policies.