So far, markets seem quiet. Yes, it looks like a summer Friday.

No doubt, the Turkish lira (TRY) saga has dominated this week’s foreign exchange markets. The Turkish lira now seems to have steadied somewhat after a really wild week that was marked by a painful and damaging slide and then a rapid rally.

For now, the Turkish currency is still holding on most of Thursday’s gains.                  

In early European trading, the currency was holding on to Thursday’s gains, trading roughly 0.6 per cent higher against the dollar on the day at about 6 TRY per dollar.

To put this in perspective, this time last week, the lira was falling hard; it dropped by 16 percent on August 10 after Turkish President Erdogan declared that the country was engaged in “economic warfare” and that “righteousness and our God” would defend it against further pain. The Turkish lira tumbled to as low as 7.20 TRY to the dollar.

Then, on Wednesday, Turkish regulators moved to clamp down on speculative bets against the Turkish lira, followed on Thursday by a global investor conference call between the new Finance Minister Berat Albayrak and global investors, which has helped to stem the bleeding.

In its latest steps to shield the Turkish economy, the Ministry of Finance said today (Friday) in a statement that non-financial companies’ credit worthiness wouldn’t be affected by failure to service debt amid the recent rout. Credit lines to firms would remain open, and pricing and repayment periods would be kept flexible.

Mr. Albayrak, was made Finance Minister last month by his father-in-law President Erdogan himself. Investors believe the Turkish President bears much of the blame for the precipitous plunge in the Turkish lira in recent weeks and view Mr. Albayrak as little more than his cipher.

A small detail that could be of interest to investors is that when Finance Minister Berat Albayrak began the conference call with global investors on Thursday it was the first time that most of them had contact with the young former businessman in charge of Turkey’s troubled economy.

For investors it’s also certainly important not to overlook that next week the financial markets in Turkey will be closed from Tuesday, August 21 till Saturday August 25 because of the “Eid al-Adha” that is also called the "Festival of Sacrifice", which is the second of two Islamic holidays celebrated worldwide each year and considered the holier of the two.

Now, President Trump’s administration has undermined some of this week’s support, with the U.S. President tweeting overnight that “we are cutting back on Turkey” in response to the case of an evangelical U.S. pastor detained in the country.

Mr. Trump’s tweet reads:

“Turkey has taken advantage of the United States for many years. They are now holding our wonderful Christian Pastor, who I must now ask to represent our Country as a great patriot hostage. We will pay nothing for the release of an innocent man, but we are cutting back on Turkey!”

The Treasury Secretary Steven Mnuchin said during a Cabinet meeting at the White House on Thursday the U.S. is ready to slap Turkey with more sanctions if President Erdogan refuses the quick release of an American pastor, escalating a diplomatic rift that has roiled global financial markets. “We put sanctions on several of the Cabinet members. We have more that we’re planning to do if they don’t release him quickly.”

During that same Cabinet meeting President Trump said of Turkey: “They have not proven to be a good friend.”

Still, for now at least, the Turkish lira remains relatively calm.

One could say that the Turkish Finance Minister Mr. Albayrak has bought some time, but few, as I do, think the crisis for Turkish markets is over.

What is happening to the Turkish lira comes in fact down to the following: the restriction of swap trades means that the market can no longer express its view in a free manner. The lira weakness was a clear message to those responsible in Turkey that their monetary policy was a disaster. Now the messenger is shot. Initially that feels good, but it does not change the underlying issue.

Let’s hope that those responsible in Turkey know what they are doing…

In the meantime, an appeals court in the coastal city of Izmir is set to rule by Saturday on a bid by Brunson’s lawyer to release him.

Etienne "Hans" Parisis is a bank economist who has advised investors on financial markets and international investments.