ISTANBUL (Reuters) - Turkey's lira slipped on Friday after U.S. lawmakers included mandatory Turkish sanctions in a defence spending bill that moves Washington a step closer to punishing its NATO ally for buying Russian S-400 missile defences last year.

The final version of the $740 billion annual U.S. defence spending legislation would oblige the White House to select from a list of sanctions over the S-400s, which Washington says are incompatible with NATO operations.