I'm learning about deformation retract and have this problem as an exercise.
My attempt to prove this at this point follows from the definitions: I want to find a retract $r: r\circ\hookrightarrow = id_Y$ such that $\hookrightarrow$$\circ$r $\simeq$ id$_X$. To satisfy the latter condition I will also have to find a function $h(x,t)$ such that $h(x,0) = \hookrightarrow$$\circ r$ and $h(x,1) = id_X$.
My definitions of $r$ and $h$ are as follow:
$\bullet$ Let $x \in X, x = ((a,b), (c,d)), -1\le a, b, c, d \le 1; a,c \neq -1; b,d \neq 0$.
Then $r$ could be taken to be $r(x) = x_Y$, where $x_Y$ is such that
the distance function $d(x,x_Y) = min(d(x,((a,b),(0,1)), d(x,((1,0),(c,d))$
(i.e. for each point $x = ((a,b),(c,d))$, the retract maps it to either $((a,b),(0,1))$ or $((1,0),(c,d))$, depending on which one is closer to $x$).
$\bullet$ $h$ then could be taken to be: $h(x,t) = (1-t)r(x) + tx$
Is this an acceptable answer?

Let me rephrase this question with the notation $S^1=\{z\in\mathbb{C}\mid |z|=1\}$.
OP suggested the following retraction $r\colon X\to Y$.
Actually this retraction is not well-defined. For example, if $z_1=z_2=e^{\pi i/4}$, then $(z_1,z_2)$ has the same distance with $(z_1,i)$ and $(1,z_2)$. Then which one is $r(z_1,z_2)$?
This question is a good exercise for students learning a first course of algebraic topology. I suggest to read "0.1 Construct an explicit deformation retraction of the torus with one point deleted onto a graph consisting of two circles intersecting in a point, namely, longitude and meridian circles of the torus" (the 1st page).