What happened

Second verse, same as the first. Last week, shares of Turkish telco Turkcell Iletisim Hizmetleri (NYSE:TKC) got thrown for a 13% loop when the U.S. government announced plans to double tariffs on imports of Turkish steel and aluminum. The Turkish lira took a nosedive in response, rattling the entire Turkish economy -- Turkcell included.

This morning, it looks like more of the same. Turkey's national currency  closed at an exchange rate of 6.43 lira to the U.S. dollar last week. Today, it costs 6.90 lira to buy a greenback -- 7.3% more -- and Turkcell stock is off a similar amount, about 6.6% as of 11:30 a.m. EDT, after hitting a nadir down 11% earlier in the day.

Turkish lira banknotes

Anything tied to the Turkish lira is going down today -- Turkcell stock included. Image source: Getty Images.

So what

Looked at another way, one Turkish lira currently buys only 0.14 USD, versus the 0.16 of a dollar it would have bought at close of trading on Friday. That's more like a 12.5% devaluation, which not only explains why Turkcell stock went down much earlier Monday -- but suggests we could see the currency collapse again.

Now what

What will it take to stabilize the Turkish lira -- and Turkcell stock? A decision by Donald Trump to lift the sanctions and reverse the tariffs would probably do the trick. But before that can happen, Turkey would probably have to cave in to U.S. demands that it release Pastor Andrew Brunson, an American missionary whom Turkey has imprisoned for nearly two years.

Until there's movement on that front, I wouldn't hold out much hope for things improving for Turkcell stockholders anytime soon.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.