Turkey’s main banking regulator curbed the ability of Turkish banks to swap liras for foreign currencies in an announcement on its website late Sunday night.
The move was one of the first actions Turkish financial officials have taken to address the drastic fall in the value of the lira since President Trump said on Friday that he would increase tariffs on the imports of Turkish steel and aluminum.
A large Turkish bank, Garanti Bank, also said late Sunday that it would no longer allow customers to open new foreign exchange trading positions, a step that would make it harder for people to sell their liras for dollars, mainly, but also for euros and British pounds.
The actions come at a time of rising global concern over the health of the Turkish economy, and there are fears that the currency turmoil could spread to other markets.
In early futures trading on Monday morning in Asia, the lira dropped more than 20 percent to 7.2 to the dollar, before strengthening slightly to 6.8. The plunge came after a more than 13 percent decline in the currency on Friday.
In recent months, investors have become increasingly concerned about Turkey’s high levels of foreign debt and the reluctance of the central bank to raise interest rates, the traditional approach when a currency comes under attack.
President Recep Tayyip Erdogan has said repeatedly that higher interest rates will not bring down inflation. And on Sunday, he continued his criticism of those selling liras, lashing out at credit rating agencies and urging Turkish industrialists to refrain from swapping liras for other currencies.
Over the weekend, Turkey’s new finance minister, Berat Albayrak, said that the government would put an action plan forward on Monday, but investors, after days of inaction, remained skeptical that the lira’s slide would be halted.
The country’s main banking regulator said on Sunday that foreign exchange operations by Turkish banks could not exceed 50 percent of their equity. Turkish banks have been very aggressive in borrowing in dollars from foreign banks to lend to local companies and real estate developers.