Turkey’s trade balance improved in January. The deficit narrowed to -8.38B from -9.3B in the previous period.
This change means the gap between exports and imports became smaller. The trade balance remained in deficit.
The narrowing of the trade deficit to -8.38 billion in January is a positive signal for the Turkish Lira. This improvement suggests that the economic policies aimed at rebalancing the economy are beginning to show results. Derivative traders should view this as a reinforcing factor for strategies that bet on Lira stability or appreciation in the near term.
This data point builds on the positive momentum we saw in the last quarter of 2025. With inflation finally showing a convincing decline to 38% in December and the Central Bank holding interest rates firm at 50%, the macro picture is improving. This makes selling USD/TRY futures or buying Lira call options a more fundamentally sound position for the coming weeks.
Looking back, we remember the painful but necessary policy pivot that began in mid-2023 and continued through 2024. The current stability is a direct result of that sustained monetary tightening. The January trade data is one of the first hard data points of 2026 that confirms this difficult path is yielding the intended outcome.
For equity derivative traders, this backdrop is constructive for the BIST 100 index. A more stable currency reduces uncertainty and has been attracting foreign capital, evidenced by the over $12 billion in net portfolio inflows during the second half of 2025. We should therefore consider maintaining or adding to long positions in BIST 100 futures.
This trend toward stability should also dampen the extreme currency volatility we have grown accustomed to. The VIX-equivalent for the Lira has already fallen from its 2024 highs of over 40% to just under 25% this month. This environment makes selling volatility through options strategies, like short strangles on the EUR/TRY pair, an increasingly viable strategy.
