Turkey and the United States exchanged new threats of sanctions Friday, keeping alive a diplomatic and financial crisis that is threatening the economic stability of the North Atlantic Treaty Organisation country as a Turkish court rejected the appeal of an American pastor caught in the middle of the row.
The Turkish lira stood at 5.80 per dollar on Friday, up about 0.4 percent against the dollar.
While Turkey's economy is fairly unimportant globally, the country itself holds an important strategic position as a buffer zone between the West and the Middle East, and as such has outsized influence in foreign policy circles.
"They should have given him back a long time ago, and Turkey has in my opinion acted very, very badly", Trump told reporters at the White House, referring to Brunson.
Mr Erdogan is angry that the USA has not taken more action against the Gulenist movement and what he said was a failure "to unequivocally condemn" the 2016 coup attempt.
Albayrak spoke Thursday with his German counterpart Olaf Scholz and they agreed to "take steps in order to reinforce economic cooperation", Albayrak's office said.
In the Turkish courts, Brunson has been unsuccessful in arguing for his release, and on Friday had his latest appeal rejected, according to The Associated Press. If convicted of what the government considered terrorist activities Brunson could face as many as 35 years behind bars. As President Trump has stated, Pastor Andrew - who is being punished because of his Christian faith - is a "great patriot".
It was not immediately clear what additional measures, if any, Trump could be considering.
U.S. Treasury Secretary Steven Mnuchin told President Donald Trump at a cabinet meeting on Thursday that sanctions were ready to be put in place if Brunson, who is on trial in Turkey on terrorism charges, was not freed.
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An Istanbul court on Wednesday allowed the release of Amnesty International's Turkey chair Taner Kilic, who spent more than a year in jail over alleged links to a 2016 coup bid.
USA support for Kurdish rebel groups fighting Islamic State fighters in northern Syria is another major difficulty, given Turkey's battle against a Kurdish insurgency in its own country.
At 0937 GMT the currency TRYTOM=D3 stood at 6.2499 to the dollar, almost 7 percent weaker. Earlier in the session it fell as much as 7pc. Turkey also maintains a small military base in Qatar. "We remain hopeful there will be a prompt resolution".
Albayrak said there would be no concessions on fiscal discipline, adding: "We are targeting lowering inflation into the single digits as soon as possible".
"Turkey has taken advantage of the United States for many years". "Our relations with Turkey are not good at this time!"
Turkey and its firms face repayments of almost $3.8 billion on foreign currency bonds in October, Societe General calculated. For companies, the cost of servicing foreign debt has risen by a quarter in lira terms in the past two months.
The defiant leader hit out a day after ratings agencies Moody's and Standard & Poor's downgraded Turkey closer to junk status amid the currency crisis.
Officials reportedly know Brunson's release is the first step to alleviating the diplomatic and economic crises sparked between the two countries, but are aiming for further negotiation with the US.
Turkish President Recep Tayyip Erdogan on Saturday warned against threatening his country with sanctions.