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Lira gains 5 percent after Turkish court releases American pastor

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The Turkish lira has gained over 5 percent in value against the US dollar since last Friday after the emergence of signs of recovery in relations with the US that were strained due to the incarceration of an American pastor.

As of Friday the USD/TRY exchange rate saw 5.60 levels, while it closed last week at 5.93, according to the state-run Anadolu news agency.

The average US dollar/Turkish lira exchange rate was 6.04 during the first two weeks of October, 6.38 last month and 5.74 in August, according to the Turkish Central Bank.

The lira had been in free fall since May, causing a currency crisis that led to high inflation and a significant hike in interest rates.

The lira was first hit by President Recep Tayyip Erdoğan’s decision to appoint his son-in-law Berat Albayrak as finance minister in June and later a court ruling that put American pastor Andrew Brunson under house arrest in July after almost two years in pretrial detention on terrorism charges.

In August the lira briefly plunged to 7.20 to the dollar in response to US sanctions on two Turkish ministers and tariffs on aluminum and steel imports.

An İzmir court released Brunson on Oct. 12, a decision viewed as a signal from Turkey to the US as a recovery in relations and relief from the economic pressure coming from Washington.

US President Donald Trump thanked his Turkish counterpart, Recep Tayyip Erdoğan, for Brunson’s release.

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