Sunday's presidential election result in Turkey has left Erdogan in pole position to win in the second round run-off on 28th May. If Erdogan does win, all eyes will focus on Turkey’s imbalances and how quickly policymakers let the lira depreciate. Further out, concerns about the health of the banking sector and the public finances are likely to grow. Elsewhere, the more generous subsidies proposed this week by Poland's ruling party are likely to be followed by further policies ahead of elections later this year, raising upside risks to our inflation and interest rate forecasts. And finally, Q1 GDP data released across Russia, Israel and Central Europe this week showed that economies generally performed better than we had expected.
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