If you’ve been watching the AED to TRY exchange rate lately, you know it’s been a bit of a wild ride. Honestly, "wild" might be an understatement. For anyone sending money from Dubai to Istanbul or planning a summer getaway to the Bosphorus, the numbers on the screen can feel like a moving target.
As of January 16, 2026, the rate is hovering around 11.78.
Compare that to where we were just a couple of years ago. Back in early 2024, you could get about 8.11 Lira for a single Dirham. That is a massive shift. It basically means the Dirham’s purchasing power in Turkey has surged by over 45% in two years. If you’re holding Dirhams, you’re sitting pretty. If you’re earning Lira, well, things are a lot more complicated.
Why the AED to TRY exchange rate keeps shifting
The biggest thing people miss is that the Dirham isn't really moving on its own. The UAE Dirham is pegged to the US Dollar. It’s rock solid. It doesn’t budge unless the Fed in Washington does something drastic. So, when we talk about this specific pair, we are really talking about the internal drama of the Turkish Lira.
Turkey has been fighting a massive inflation battle. We saw annual inflation peak at a staggering 75% back in May 2024. Since then, the Central Bank of the Republic of Türkiye (CBRT) has been doing some serious heavy lifting. They hiked interest rates up to 50% to try and cool things down.
It worked, sorta.
By the end of 2025, inflation finally dipped into the low 30s. That sounds high—and it is—but compared to where it was, it’s a relief. Because inflation is still higher in Turkey than in the UAE, the Lira naturally loses value against the Dirham over time. It’s basic math. If prices in Turkey rise faster than in Dubai, the currency has to adjust so that a loaf of bread or a hotel room stays "fairly" priced in global terms.
The Central Bank's New Playbook
Right now, the CBRT is in a "calibrated easing" phase. They aren't just hacking away at rates anymore. In December 2025, they cut the policy rate to 38%. They’re trying to find that "Goldilocks" zone—low enough to keep the economy moving, but high enough to keep people from dumping their Lira for Dollars or Dirhams.
Governor Fatih Karahan has been pretty vocal about this. The bank isn't trying to hit a specific exchange rate target. They want price stability. But for you and me, that translates to a Lira that is depreciating much more slowly than it used to.
Real-World Impact: From Expats to Investors
You’ve probably noticed the shift if you live in the UAE. The "Turkey is cheap" narrative is still true, but it’s changing.
- The Remittance Reality: For the thousands of Turkish expats living in the Emirates, this rate is a lifeline. Sending 5,000 AED home now nets you nearly 59,000 TRY. In early 2024, that same 5,000 AED was only worth about 40,000 TRY. That’s a huge difference for families paying for school fees or mortgages back home.
- Tourism Trends: Dubai and Abu Dhabi airports are seeing record numbers of travelers heading to Turkey. In the first half of 2025 alone, Dubai welcomed nearly 10 million international visitors, and many of those are using the UAE as a hub to jump over to Turkey. Even though Turkish prices have risen due to inflation, the favorable exchange rate offsets a lot of that for Dirham holders.
- Business & Trade: The UAE and Turkey signed a Comprehensive Economic Partnership Agreement (CEPA) a while back. Non-oil trade is booming. But here’s the kicker: when the Lira is weak, Turkish exports (like textiles and auto parts) become incredibly cheap for UAE businesses. This is one reason why your "Made in Turkey" goods at the mall haven't seen the same price hikes as other imported items.
What to expect for the rest of 2026
Predictions are a fool's errand in forex, but the data points to a "managed" slide.
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Most analysts, including those from Standard & Poor’s and ING, expect the Lira to continue its gradual decline. We aren't seeing the "flash crashes" of previous years. The CBRT has built up its reserves—gross international reserves hit a significant milestone recently, partly thanks to the rise in gold prices. This gives them a "war chest" to prevent the AED to TRY exchange rate from spiraling out of control.
Expectations for the end of 2026 suggest we might see the rate move toward 13.0 or even 14.0, depending on how fast the CBRT continues to cut interest rates. If they cut too fast, the Lira will drop. If they stay cautious, it might stabilize.
Don't forget the UAE side of the coin
The UAE economy is a juggernaut right now. GDP is projected to grow by about 4.7% in 2026. While the rest of the world is worrying about recessions, the Emirates is seeing a "non-oil" boom in construction and tech. Because the Dirham is so strong, it acts as a magnet for regional capital.
If the US Federal Reserve starts cutting rates in late 2026 (as S&P Global expects), the UAE Central Bank will follow suit to maintain the peg. This would keep the Dirham-Dollar relationship steady, meaning the AED to TRY exchange rate will remain almost entirely dependent on what happens in Ankara, not Abu Dhabi.
Actionable Steps for Managing Your Money
If you need to deal with this exchange rate, stop just looking at the Google ticker.
- Watch the CBRT Meetings: The Turkish Central Bank now meets eight times a year instead of twelve. These are the "volatility events." If they announce a larger-than-expected rate cut, expect the Lira to dip immediately.
- Use Limit Orders: If you are an expat sending money, don't just "send now." Many exchange houses and apps like Wio or Wise let you set a target rate. If the rate hits 11.90 for a brief window, the transfer happens automatically.
- Hedge for Business: If you’re importing goods from Turkey, consider forward contracts. Locking in a rate now for a shipment three months away can save you from a sudden 5% swing that eats your margin.
- Travel Timing: If you’re planning a trip, book your hotels in Lira if the rate is moving in your favor, but keep an eye on "inflation-adjusted" pricing. Sometimes hotels in Istanbul will quote in Euros to protect themselves; always ask for the Lira price and compare it to the spot rate.
The bottom line? The days of the Turkish Lira being a "stable" currency are gone for now, but the chaos of 2023 and 2024 has subsided into a more predictable, downward trend. Use the strength of the Dirham while you have it.
Next Steps for You
Keep a close eye on the next CBRT interest rate decision scheduled for late January. If you have a large transfer to make, wait for the post-meeting market reaction, as the "calibration" of these rate cuts is currently the single biggest driver of the Lira's value.