The Turkish lira has lost 13 per cent of its value against the dollar since midnight, pushing the battered currency further into crisis.
Waves from the crisis spread overseas, with investors selling off shares in European banks with large exposure to the Turkish economy. Thus, Trump's tweet suggests that any country that enters a time of economic turmoil - and consequently, sees the value of its currency fall - is a fair target for punitive trade actions by the United States.
For a start, investors are anxious that Turkish companies that borrowed heavily to profit from a construction boom may struggle to repay loans in dollars and euros, as the weakened lira means there is now more to pay back.
He said he had authorized higher tariffs on imports from the United States' NATO ally, imposing duties of 20 percent on aluminum and 50 percent on steel. "If they have the dollar, we have Allah", he said in a speech early today.
But Carsten Hesse, analyst at Berenberg bank in London, says that an economic downturn in Turkey would have limited impact on Europe or other major economies.
Turkey wants the United States to extradite cleric Fethullah Gulen, a Pennsylvania-based cleric who Turkish authorities say masterminded the coup attempt in which 250 people were killed.
The U.S. exported $9.75 billion worth of goods-mostly cotton, scrap iron, steel, civilian aircraft parts, coal, and petroleum gases-to Turkey, and imported $9.42 billion worth of goods from them.
Trump raised the stakes on Friday when he said that his administration would double its tariffs on Turkish steel and aluminum.
Trump doubles tariffs on steel, aluminum from Turkey President Trump and Turkish President Recep Tayyip Erdogan appear in the Roosevelt Room of the White House on May 16, 2017. Independent analysts argue the central bank should instead raise rates to tame inflation and support the currency.
Turkey's trade ministry said the tariffs were against World Trade Organization rules.
The prospect of a deal for Brunson's release appeared high as Turkish officials traveled to Washington this week, but the deal apparently fell apart over last-minute Turkish demands.
President Recep Tayyip Erdogan, who had remained unusually silent until now as the lira crisis mounted, urged Turks to take matters into their own hands. But some investors fear the Turkish economy is growing too quickly and could face problems.
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".
"This is a national, domestic battle".
State Department Spokesperson Heather Nauert told reporters on August 9 that the United States would define progress in relations with Turkey with Brunson's return to the United States. Gulen has denied the allegation.
Turkey's woes have been aggravated by investor worries about the economic policies of Mr Erdogan, who won a new term in office in June with sweeping new powers.
"Normally, Turkey might be able to shrug off this kind of story; however, right now the Turkish economy is already in the terminal stages of a descent into crisis".