Turkey is facing mounting pressure to announce an emergency rise in interest rates as rampant inflation, a plunging currency and American sanctions push one of the world’s key emerging market countries to the brink of crisis.

Analysts said Turkey’s central bank would have no choice but to increase borrowing costs aggressively in the coming days to stem the fall in the lira, which is down by almost a third against the US dollar in the past 12 months and hit a record low this week.

The currency’s weakness has been exacerbated by the increasing tendency of Turkey’s president, Recep Tayyip Erdoğan, to interfere in the conduct of monetary policy by opposing the use of higher interest rates to cool an overheating economy.

This week’s turbulence was triggered by news that the Trump administration was considering removing Turkey’s eligibility for preferential trade treatment in protest at their imprisonment of the US pastor Andrew Brunson.

The threatened loss of duty-free access to the world’s biggest market for Turkish exports would further weaken the lira by removing a crucial source of dollar inflow.