Turkey's financial crisis and further USA pressure spurred more concern among investors as fears appeared to spread to American markets.
"As we have seen during the Greek debt crisis, financial markets are sufficiently interwoven that concerns over debt serviceability in one region can spread quite quickly within European banks".
Finally, Turkey is also embroiled in a political stalemate with the United States that has signs of spiralling into sanctions and fines between the two North Atlantic Treaty Organisation allies.
The lira, which has lost more than 40 percent this year, hit a new record low after Trump took steps to punish Ankara in a wide-ranging dispute.
A "gigantic rate hike" of at least 500 basis points to calm markets and a clear commitment from the Central Bank of Turkey to support the currency could help halt the decline, Hordijk said, adding, "Another bandage to stop the lira from bleeding to death would be capital controls, but Erdogan opposes these measures". Put these all together, and you get a pretty classic emerging markets crisis: Money has been leaving Turkey because it can now get good enough returns elsewhere, which is then pushing down the value of their currency so much that their dollar debts are getting harder to pay back.
He railed against "those waging economic war" against Turkey.
The Trump administration's original move in March to raise tariffs on most steel and aluminum imports was proposed to safeguard USA jobs against overseas rivals.
In a statement, the White House said the president had authorized the preparation of documents to raise tariffs, citing national security concerns.
Turkey's trade ministry said the tariffs were against World Trade Organisation rules.
"Some countries have engaged in behaviour that protects coup plotters and knows no laws or justice", he said.
The United States has increasingly used economic sanctions against foes such as Iran or North Korea but it is highly unusual for an administration to impose import tariffs over political or judicial issues with other countries.
In this file photo taken on July 11, 2018, US President Donald Trump (L) speaks with Turkey's President Recep Tayyip Erdogan (R) as they arrive for a North Atlantic Treaty Organisation summit at North Atlantic Treaty Organisation headquarters in Brussels.
'If they have their dollar, we have the people, we have Allah, ' he said.
Turkey vowed retaliation "without delay" and warned the move would further harm relations between the two allies.
Turkey's woes have been aggravated by investor worries about the economic policies of Erdogan, who won a new term in office in June with sweeping new powers.
"One area we are more concerned about is contagion into the European market via the banking sector". Relations between the United States and Turkey have been weakening for several reasons. Gulen denies the allegation. He offered no further details.
Andrew Craig Brunson, an evangelical pastor from Black Mountain, North Carolina, arrives at his house in Izmir, Turkey, Wednesday, July 25, 2018.
Erdogan enjoys the support of many Turks even though rents and food and fuel prices have all surged.