Turkish Prime Minister Recep Tayyip Erdogan threatened to expel foreign diplomats involved in "provocative actions" amid a corruption probe that has shaken his government and roiled markets. U.S. ambassador Francis Ricciardone is crossing the line of diplomacy and threatening Turkey, according comments on Twitter by Salih Kapusuz, deputy chairman of Erdogan's Justice and Development Party and head of public relations. "We don't have to keep ambassadors in the country who exceed the limits of their duty," Erdogan said in speech in the Black Sea city of Samsun today, without naming anyone. Erdogan also said the probe is an operation against his government with "an international dimension" with local agents to weaken the country. The sons of Interior Minister Muammer Guler and Economy Minister Zafer Caglayan and Suleyman Aslan, CEO of state-run lender Turkiye Halk Bankasi AS (HALKB), were formally arrested in an investigation into bribery, Hurriyet newspaper reported today. Police have said the inquiry targets organized graft, money laundering and gold smuggling. At least 60 police chiefs have been purged this week as the probe has sparked concerns of an escalating confrontation between Erdogan and his former political ally, U.S.-based Islamic cleric Fethullah Gulen, who has a wide following in the police and judiciary. Kapusuz cited reports in pro-government local media that Ricciardone had asked Halkbank to cut relations with Iran. Ricciardone has said the reports are untrue and the U.S. has nothing to do with Turkey's corruption probes. The lira fell to a record low yesterday against the euro and the dollar. The yield on benchmark two-year domestic notes climbed 25 basis points to 9.61 percent, the highest in more than three months. Source : bloomberg
