U.S. undecided on sanctions for Turkey over S-400 purchase, says Trump

(Updated with U.S. President Donald Trump's comments contradicting his earlier comments)

U.S. President Donald Trump made contradictory statements on Thursday on whether the United States would sanction Turkey for its purchase of Russian-built S-400 missile defence systems.

Contradicting a statement he had made a short time before, Trump told reporters at the White House that his administration was considering placing sanctions for its procurement of the missile defence systems.

“We’re looking at it, and see what we do. We haven’t announced that yet,” Trump said.

Earlier on Thursday Trump had said he was not looking to place sanctions on Turkey “right now” over the purchase.

The lira made gains on news of Trump's first statement, and was up 1 percent to 5.627 against the dollar at 1:14 p.m. New York time, Bloomberg reported.

The U.S. president’s announcement came a day after he formally expelled Turkey from the F-35 fighter jet programme over its procurement of the Russian systems, which U.S. officials say could cause security breaches for the F-35s and other NATO hardware.

There is bipartisan agreement at the U.S. Congress that measures should be taken over the S-400 purchase, with bills passed this year requiring sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA).

On Monday, Secretary of State Mike Pompeo told the Washington Post, “the law requires that there be sanctions and I’m confident that President Trump will comply with the law.”

However, Trump’s initial statement suggested there's still a possibility Turkey will be spared potentially crippling sanctions, at least for the time being.

Trump’s sympathetic comments during last month’s G-20 summit in Osaka were interpreted by Turkish President Recep Tayyip Erdoğan that the U.S. president would seek to cancel or mitigate measures against Turkey for the S-400 purchase.

The law related to CAATSA sanctions says Trump must choose five out of 12 possible sanctions to implement on Turkey. The president is able to seek to delay the sanctions or seek a waiver.