Turkey Moves U.S. Pastor to House Arrest After Tensions Spiked

(Bloomberg) -- Turkey decided to release American pastor Andrew Brunson to house arrest on Wednesday, a step that is likely to ease heightened tensions between the NATO allies but falls far short of U.S. demands for his acquittal. The lira and stocks gained.

Protestant missionary Brunson has spent nearly two years in jail on charges of collaborating with Turkey’s foes and attempting to stir chaos by inciting hatred based on religious and ethnic differences. His release was ordered a week after a court in Izmir rejected his attorney’s request to free the pastor, citing the seriousness of charges against him. President Donald Trump called the court decision a “total disgrace.”

“It is a positive step but not sufficient,” Anthony Skinner, a director with U.K.-based forecasting company Verisk Maplecroft, said by email after media reported that Brunson was to be taken from jail. “The U.S. administration is calling for his full release and return to the United States. It is a small gesture which has come in response to U.S. pressure, but I don’t expect a fundamental improvement in bilateral relations.”

Over the past week, the U.S. had signaled that it could impose restrictions on sales of a key jet fighter to Ankara, as well as seek to curb loans from international lenders, to protest Turkey’s jailing of Americans. The pastor’s imprisonment had soured ties already strained by the civil war in Syria, and the U.S. refusal to extradite a cleric who Turkey alleges orchestrated a failed coup two years ago.

Erdogan Offer

In a recent television interview, Turkish President Recep Tayyip Erdogan offered to swap Brunson for the cleric, Fethullah Gulen, whose followers have been systematically purged from Turkish institutions since the attempted putsch.

The idea of an exchange has drawn criticism from U.S. embassy officials in Ankara who said the circumstances surrounding the extradition request for Gulen were quite different from the allegations Brunson faces.

Brunson is accused of aiding two of Ankara’s archenemies: Gulen and the autonomy-seeking Kurdish PKK group, branded a terrorist organization by the U.S., the European Union and Turkey. He says he is innocent of any wrongdoing.

The lira and Turkish stocks rose after the news of Brunson’s house arrest on expectations that it would help repair ties with the U.S. The currency was trading 0.9 percent higher at 4.8395 per dollar at 3:12 p.m. in Istanbul. The Borsa Istanbul 100 index of Turkish stocks was up 3.1 percent.

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