Trump Blinks: Europe Rallies as Trade War Fears Ease
The Trump administration’s shift — whether a pause, a reversal, or a strategic retreat — matters because markets had been pricing in a worst-case scenario for global trade. When that pressure valve loosens even slightly, capital moves fast. European exporters, automakers, and industrials were among the biggest beneficiaries, sectors that had been hammered by tariff uncertainty in recent weeks.
For Turkey, this is not a distant storyline. When European markets catch a bid, risk appetite for emerging markets tends to follow. Turkish equities and the lira both have a well-documented sensitivity to global sentiment shifts. A calmer external backdrop gives the Central Bank of Turkey more breathing room and takes some pressure off the currency — at least temporarily. The question is whether this relief lasts or proves to be another head-fake in what has been an extraordinarily volatile year for global markets.
💬 Levent KAYIRA Commentary
Ekonomik Gündem Analysis: Let’s put this in Turkish market terms. The BIST-100 has been trading with one eye permanently fixed on Washington for months. Every Trump headline — tariffs, exemptions, reversals — creates a ripple that hits Istanbul within hours. When European risk premiums compress, Turkish eurobond spreads typically follow, and we’ve seen that pattern play out repeatedly since 2018.
The lira is the most direct transmission channel here. Dollar/TL has been holding above 38.00 under sustained pressure. A genuine improvement in global risk sentiment could bring some portfolio inflows back into Turkish assets — bonds first, then equities. We’re not talking about a structural reversal, but even a few weeks of calmer external conditions matters for the carry trade.
For local investors, the more important question is whether this Trump pivot is durable. My 15 years in Turkish banking taught me one thing: relief rallies built on political decisions are the most fragile kind. Price the good news, but keep your stop-losses tight. The fundamentals — Turkish inflation still above 60%, Fed on hold — haven’t changed.
Kaynak: Google News Ekonomi