May 16, 2017: Trump welcomes Erdogan to Washington, saying both presidents have a "great relationship" and would make it "even better." Erdogan congratulates Trump on his "legendary" 2016 election win but complains bitterly about US arming of the Kurdish YPG militia, claiming that its inclusion in the US-led campaign against IS in in war-torn Syria provides a cover for Kurdish separatism.

May 17: As Erdogan ends his visit, Voice of America video footage emerges showing his guards assaulting Kurdish protesters outside the Turkish ambassador's residence in Washington. A month later, US authorities issue arrest warrants for 12 members of Erdogan's security detail, who had long returned to Turkey. US Secretary of State Rex Tillerson says the assaults breached "legitimate" free speech.

July 15, 2017: Turkey marks the first anniversary of the failed coup attempt. In a post-coup bid crackdown 50,000 people were arrested, accused of links to the US-based cleric Fethullah Gulen, an Erdogan ally-turned-rival. Tens of thousands more face job suspensions. The refusal of the US to extradite Gulen has been a major sore spot in relations.

August 23: US Defense Secretary James Mattis visits Ankara as the Pentagon stresses US commitment to bilateral relations and "honest dialogue." Mattis had just visited Iraq to assess the anti-IS campaign. Erdogan tells Turkish media that Turkey will thwart any attempt by the Kurdish People's Protection Units (YPG) to establish a "terror corridor" in northern Syria through to the Mediterranean.

October 5: Turkish authorities arrest Metin Topuz, a Turkish national employed at the US consulate in Istanbul. He is formally charged with espionage and collaboration in the 2016 coup attempt. The US embassy in Ankara subsequently says it is "deeply disturbed" by the arrest. It's reportedly the second since March, when a Turkish US consulate employee was arrested in Adana.

October 8-9: The United States suspends its issuance of non-immigrant visa applications to Turkish nationals, saying it has to "reassess" Turkish readiness to respect security at US diplomatic missions. Turkey suspends its visa services for US nationals and summons another staffer at the US consulate in Istanbul.

November 6: The US Embassy in Ankara announces that it is reinstating its visa program for Turkish tourists on a "limited" basis after receiving assurances from the government that no employees will be detained "for carrying out official duties." Shortly thereafter, Turkey confirms that it is also resuming visa services for US citizens one day before Prime Minister Yildirim visits Washington.

December through August, 2018: In December, Turkey announced it would buy the Russian S-400 missile system, which is incompatable with NATO systems. The US Congress has included a provision in a defense bill that would cut Turkey out of the F-35 fighter jet program if it moves forward with the S-400 deal.

August 1, 2018: The US sanctions Turkey's interior and justice ministers over the continued detention of pastor Andrew Brunson. Brunson had been moved from prison to house arrest in late July, but that fell short of US demands for his immediate release and end to terror and espionage charges. Brunson was arrested almost two years ago.

Turkey is in the throes of a full-blown currency crisis, with the Turkish lira losing nearly 45 percent of its value since the start of the year. The currency crisis threatens to plunge the world's 18th-largest economy into a financial crisis and trigger contagion in emerging markets and Europe.

Turkey has traditionally suffered from a large current account deficit. This difference between import and export of goods and services has been filled through external borrowing in foreign currency. A decade of easy money and low interest rates in the United States and EU following the 2008 financial crisis led to investors searching for higher yields to emerging markets like Turkey.

The external funds entered the Turkish economy to finance deficits, massive government spending and company borrowing. Credit-fueled growth helped the Turkish economy grow and boosted the government’s popularity through increased consumption and major construction projects. Here, road paint reads: "Slow down."

Investors have pulled back money from emerging markets in recent months as the US Federal Reserve has steadily raised interest rates and is cutting back on easy money policies in response to a robust American economy. This has caused the dollar to increase, the lira to fall, and Turkish bond yields to rise.

The pressure on Turkey is reflective of broader trends in emerging markets, although the lira is by far the worst performer. That's because investors have lost confidence in management of the economy under President Recep Tayyip Erdogan, who believes in unorthodox economic policy, demands low interest rates and constantly assails "the interest rate lobby." Inflation is at 16 percent a year.

On August 10, US President Donald Trump announced higher tariffs on Turkish imports of steel and aluminum. The tariffs themselves are minor and impact around $1 billion (€875 million) in trade, but they weighed on market confidence in the vulnerable Turkish economy. Even more, Trump’s direct reference to the Turkish lira sent the currency tumbling.

The imprisonment of US pastor Andrew Brunson has weighed heavily on relations, leading to a series of escalations. Ties between the two NATO allies have also nosedived over US support for Syrian Kurdish forces, Ankara's plans to buy a Russian missile system and Turkey's demand that Washington extradite US-based Islamic cleric Fethullah Gulen, whom Erdogan blames for the failed July 2016 coup bid.

Poor relations between Washington and Ankara have added to Turkey's economic woes, but given broader fundamentals it is only a proximate cause of the market mayhem. More than 30 percent of the lira’s loss has come since June, when Erdogan took over the office with new sweeping powers. Erdogan's authoritarian hand has distanced the country from traditional Western allies and hit confidence.

After winning a June election, Erdogan spooked markets when he tightened his control over the central bank. Instead of appointing technocrats, Erdogan appointed his son-in-law Berat Albayrak (pictured) to lead the newly empowered Finance Ministry. This has raised concerns over the central bank's independence given the president’s repeated statements against raising interest rates.

Erdogan has not inspired confidence in responding to the lira meltdown. He speaks of "economic war" and a "campaign" waged by external powers designed to weaken Turkey. Instead of taking drastic action to shore up confidence, such as raising interest rates or going to the International Monetary Fund (IMF), the government is couching itself in nationalistic rhetoric of sacrifice.