Europe on ALERT: Turkish lira continues to FALL sparking fears of Euro CRISIS: ...

The currency fell by as much as 2.5 percent before regaining some of its losses in afternoon trade.

At 15:48 GMT, the Turkish lira was trading at ₺4.5920 per US dollar - down 1.59 percent from ₺4.52 at Thursday’s close.

It had been strengthened this week by the central bank’s announcement on Monday that it would return to using one-week repo rate as its benchmark interest rate in an attempt to simplify policy and make it more predictable.

Repo funding was resumed for the first time since January 2017, with the central bank injecting 29 billion lira at a one-week repo auction on Friday, with bids amounting to 56.77 billion lira.

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At an emergency meeting last week, the central bank also hiked interest rates by three percentage points to support the lira, strengthening it from a record low of ₺4.9290 on May 23.

But despite this mini surge, it is still down by 17 percent against the US dollar so far this year.

Per Hammarlund, chief emerging market strategist at Swedish banking group SEB, said the plummeting lira early on Friday may have been a result of remarks made overnight by President Tayyip Erdogan.

Late on Thursday, the country’s leader said that citizens who keep money in foreign currency should convert it to lira, teaching a lesson to those who are trying

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