Turkey’s budget situation improved in November, shifting from a deficit of -223.2 billion to a surplus of 169.5 billion. This indicates a big change in the country’s financial health. Exchange rates saw some movement, with the USD losing ground against major currencies. Despite this, the EUR/USD maintained its gains as we enter a busy week. Meanwhile, the GBP/USD stayed steady above 1.3350 as traders awaited data and decisions from the Bank of England.

Activity in Other Markets

In other markets, gold prices climbed to seven-week highs, driven by expectations of a Federal Reserve rate cut and ongoing geopolitical concerns. The Japanese Yen gained strength, with USD/JPY falling close to 155.00, supported by positive Tankan Q4 survey results. In the digital asset market, Solana is seeing consolidation as spot ETF inflows approached $1 billion, indicating growing institutional interest in buying dips. This mixed financial environment shows different trends across various markets and currencies. The recent Turkish budget data highlights a significant move to a surplus. This is a positive sign for the country’s fiscal responsibility. It’s the first surplus in over two years, hinting that a stronger Lira (TRY) may be on its way. We should think about strategies that benefit from a falling USD/TRY exchange rate in the upcoming weeks. This fiscal improvement backs the central bank’s strict monetary policy, which has been consistent throughout 2025. With inflation now decreased to 38% from over 75% seen in 2024, the Lira’s future looks more stable. Less volatility means selling options, like strangles on the USD/TRY pair, could be a good way to earn premiums.

Global Currency Trends

Worldwide, the US dollar is continuing to decline against major currencies. The market now sees over a 90% chance of another interest rate cut by the Federal Reserve in the first quarter of 2026, following last month’s initial cut. This perspective suggests we should stay bearish on the dollar, using futures or call options on pairs like EUR/USD to take advantage of this trend. The Japanese Yen has notably benefitted from the weaker dollar. The strong Tankan survey data adds to the positive momentum since the Bank of Japan ended its negative interest rate policy in March 2025. We believe USD/JPY is likely to continue lower, making put options on the pair an appealing strategy for protection or speculation. Gold remains steady below its all-time highs, supported by expectations of lower US interest rates and ongoing geopolitical risks. While it hasn’t yet reached new heights, the climate is favorable for higher prices, especially as real yields in the US have dropped to nearly 0.5% over the last quarter. Using call spreads on gold allows investors to capture potential gains while managing the cost of holding long positions. Create your live VT Markets account and start trading now.

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