Trump Turns up the Heat on Turkey As Lira Plunges
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The Portugal Less Traveled OFF DUTY Between Russia and J The West WS REVIEW THE WALL STREET JOURNAL WEEKEND ******** SATURDAY/SUNDAY, AUGUST 11 - 12, 2018 ~ VOL. CCLXXII NO. 35 WSJ.com HHHH $5.00 What’s Trump Turns Up the Heat Stronger News Inflation On Turkey as Lira Plunges Eats Into World-Wide BY DAVID GAUTHIER-VILLARS How many Turkish lira$1buys Paychecks he Turkish lira fell to its AND JON SINDREU Scale inverted to show the weakening lira Tlowest level ever on BY JOSH MITCHELL worries about the country’s The Turkish lira fell sharply economic stability, sending to its lowest level ever on A humming U.S. economy is tremors through Europe worries about Ankara’s eco- pushing inflation up to levels and emerging markets amid nomic stability, sending trem- Dec. 29, 2017 4 lira that the central bank consid- renewed jousting between ors through Europe and 3.79 lira ers healthy. But there’s a Erdogan and Trump. A1, A6 emerging markets amid re- downside: Americans’ pay- newed jousting between the checks are barely keeping up. Trump threatened tar- country’s leader and President Consumer prices rose 2.9% iffs on Canadian-made cars Aprilpril 18, 20182018:: TurTurkey’skey’s PresidentPresident Recep TayyiTayyipp June 24:24: Trump. over the past year, a rate last if U.S. officials can’t strike Erdoganrdogan calls for election more than a year early TurTurkishkish The lira dropped as much exceeded in late 2011, the La- a deal with the country on eelectionlection as 17% against the dollar, ex- bor Department said Friday. overhauling Nafta. A8 tending a tumble that ranks as Core prices—those outside of Mueller is bringing height- one of the steepest in world Share-price and index performance since Wednesday volatile food and energy-re- ened scrutiny to Roger Stone, markets this year. 0% lated expenses—climbed 2.4%, a longtime Trump adviser who President Recep Tayyip Er- the biggest annual gain since claimed he had interactions dogan defended his unortho- Stoxx Europe 600 September 2008. with WikiLeaks’ Assange. A4 dox policies in two speeches Stoxx Europe 600 BanksBanks The rising cost of things Friday, vowing to prevail in 5 like rent, gasoline and health The U.S. has told China’s –44 BNP ParibasParibas what he called an “economic care is another sign the econ- HNA it has to sell its stake in war.” Mr. Trump said he would –66 omy is kicking into a higher a Manhattan skyscraper that BBVABBVA double steel and aluminum gear after years of slower houses a police precinct pro- Unicredit tariffs on Turkey, a move that –88 growth. tecting Trump Tower. A4 would prevent Turkish exports ThursdayThursday FridayFriday Businesses raise prices Taliban fighters stormed from becoming cheaper with when they feel Americans are a strategic city in eastern the lira’s fall and exacerbating able and willing to spend Change in Turkey’s foreign-currency reserves since 2014, in billions Afghanistan ahead of an worries of a prolonged trade more. For much of the expan- expected cease-fire. A5 spat between the two NATO sion, inflation remained stub- allies. $0 Turkey’s lira plunged bornly low, prompting an un- Calls grew foraprobe The U.S. appeared likely to to its lowest level on precedented stimulus into airstrikes in Yemen that keep up pressure after calling –10 record against the campaign from the Federal Re- killed at least 29 children. A8 for months for the release of a dollar, underscoring serve to counteract its anemia. 6 The budget deficit widened U.S. pastor detained in Turkey. –20 the extent of investor But rising prices are now 21% in the first 10 months of “Our relations with Turkey are concern over the eating up much of Americans’ the fiscal year compared not good at this time!” Mr. country’s finances. wages gains, restraining their with the year-earlier period. A3 Trump wrote on Twitter. –30 ability to spend in the future. By the end of New York’s ’15 ’16 ’17 ’18 For just the second time in The president renewed trading day, a dollar bought four years, average hourly his criticisms of NFL play- 6.43 lira, a decline of 41% from earnings—after inflation—fell ers who protest during the Turkish consumer prices, change from a year earlier the start of the year. The Dow over the past 12 months, a national anthem. A3 Jones Industrial Average 15% separate Labor Department re- slumped 196 points or 0.8% to Friday port Friday showed. Business&Finance 25313, its third straight de- 10 6.43 lira Workers still came out cline, while the dollar rose to ahead—barely—but only be- a one-year high. In Europe, 5 t41% cause they increased the number A humming U.S. econ- PleaseturntopageA6 Lira’s decline of hours they worked. Weekly omy is pushing inflation up earnings, adjusted for inflation, 0 against dollar to levels that the Federal Turkish turmoil has become YTD Please see page A2 Reserve considers healthy, tied to U.S. pastor’s fate..... A6 2015 ’16 ’17 ’18 but Americans’ paychecks Heard on the Street: Strong Sources: Dow Jones Market Data (lira); FactSet (foreign-currency reserves, stocks, indexes); Heard on the Street: Prices are barely keeping up. A1 dollar upends markets....... B14 Turkish State Institute of Statistics (consumer prices) THE WALL STREET JOURNAL. rise, wages could be next... B14 Parts makers are lagging behind the boom in U.S. man- ufacturing, prompting some Sizing Up the Richest of Them All firms to idle production lines Parts Makers’ Shortages Tap and digest higher costs. A1 Elon Musk’s idea for a Tesla buyout has put a Brakes on Industrial Boom spotlight on the electric-car maker’s board of directors. B1 BY DOUG CAMERON have reported strong sales and the hardest-hit sector. VF Corp., the owner of AND AUSTEN HUFFORD profits in recent weeks, and These bottlenecks were evi- Lee and Wrangler jeans, is the pace of factory hiring has dent in the earnings reports exploring strategic options American factories are run- more than doubled this year manufacturers delivered over for its denim business. B1 ning short of parts. compared with the first seven the past few weeks. The S&P 500 and the Dow Suppliers of everything months of 2017. Terex Corp. said its mobile- fell Friday, snapping a five- from engines to electronic However, deliveries from crane-making unit incurred a week streak of gains, as trade components are lagging be- suppliers have slowed for 22 loss in the second quarter as tensions and jitters about Tur- hind the boom in U.S. manu- consecutive months through parts shortages hurt efficiency key rippled across markets. B13 facturing, which has lifted de- July, according to the latest at its plants. “The reality of it mand in markets such as survey of U.S. manufacturers is that elements of our supply The FDA approved the energy, mining and construc- by the Institute for Supply base could not keep up,” Chief first drug that combats tion. As a result, some manu- Management. Nearly 29% of Executive John Garrison said REX CURRY/REUTERS disease by silencing the facturers are idling production the more than 700 respon- on an Aug. 1 earnings call. BILLION-DOLLAR QUESTION: Whether Amazon’s Jeff Bezos can genes driving it. B3 lines and digesting higher dents said it took longer for Machinery giant Caterpillar be called the richest person in modern history depends on how Monsanto was ordered to costs. materials to arrive in July Inc. and power-equipment you assess past contenders for the title. The Numbers, A2 pay $289.2 million in a law- Many industrial companies than in June. Machinery was PleaseturntopageA4 suit over whether exposure to two of its powerful weed killers caused cancer. B3 French Freedom Fighters Press EXCHANGE One Man’s Quest to Venezuela’s state oil company plans to appeal a For the Rights of Parisian Rats U.S. ruling allowing one of iii Solve a Bitcoin Heist the country’s creditors to seize Citgo Petroleum. B13 Rodents overrunning the City of Light Inside have their defenders; ‘Rat-Prochement’ When Mt. Gox blew, Kim Nilsson got angry BY JOSH JACOBS control drugs. BY JUSTIN SCHECK who also lost bitcoins to track OPINION A13 AND MATTHEW DALTON Their position was “inde- AND BRADLEY HOPE down the culprits. What en- fensible, given the scale of the sued was a three-year journey Siri, Why Do I PARIS—Rats were popping infestation,” says Mr. Boulard. 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