Turkey sanctions threat rises, Romania’s government falls

The threat of sanctions against Turkey is growing and, given the context of the country’s large external debts, the fallout for local financial markets could prove to be more severe than that the relatively modest falls in asset prices seen this week. Elsewhere, the no-confidence vote passed against Romania’s government this week has raised the spectre of a prolonged period of political uncertainty and will probably push much-needed fiscal consolidation further into the future.