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Turkish President Recep Tayyip Erdogan says his country is facing an "economic war" after the lira hit a fresh record low against the dollar amid rising tensions with Washington.

The FETO and its USA -based leader Fetullah Gulen orchestrated the defeated coup attempt of July 15, 2016, which left 251 people martyred and almost 2,200 injured.

Speaking about Turkey's relations with the U.S., Erdogan said: "We expect our joint works with the U.S. on Manbij will continue unaffected, [despite] other problems between us".

US Secretary of State Mike Pompeo and Turkish Foreign Minister Mevlut Cavusoglu met on the sidelines of a regional security forum in Singapore on Friday, their first meeting since the crisis began.

Turkey and the U.S. on Friday failed to resolve a diplomatic standoff over a detained pastor in talks between their top diplomats, with Ankara warning sanctions imposed by Washington would not work. He denies the charges but faces up to 35 years in jail. He was recently moved from prison to house arrest.

"They agreed to continue to try to resolve the issues between our two countries", Nauert said. "But we have agreed to work together, closely cooperate and keep the dialogue in the coming period". "These are innocent people", he said.

He said the sanctions are meant to show Turkey that the United States is "serious" about the issue.

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After reports that the U.S. would sanction individuals over the case, the lira hit a record low of 5.01 against the dollar, before rallying slightly to 4.9.

"I am instructing my friends today, we will freeze assets, if there are any, of the USA justice and interior secretaries in Turkey", Erdogan, speaking at a ruling Justice and Development (AK) Party meeting in Ankara, was quoted as saying by the official Anadolu news agency.

White House spokeswoman Sarah Sanders said that Brunson was a "victim of unfair and unjust attention by the government of Turkey" as she announced sanctions.

The United States has also been seeking the release of three locally employed embassy staff detained in Turkey.

He is scheduled to appear before a court in October for his third hearing after the court rejected an appeal for his release in a July 18 hearing.

Brunson's case has resonated with President Donald Trump and particularly with Vice President Mike Pence, who has close ties to evangelical Christians. He was also charged with supporting outlawed PKK Kurdish militants.