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Currencies and stocks across most developing economies crept up on Friday amid hopes of imminent U.S. monetary easing, while investors awaited a rate decision out of Russia and assessed Turkey's year-end inflation forecasts.
MSCI's index tracking emerging market equities rose 0.6% and was on track for weekly gains of around 0.6%, its biggest in three. The currencies index edged up 0.5% on Friday.
Data from Bank of America showed emerging market debt saw outflows for a seventh straight week, while stocks saw inflows for a 15th straight week, at $2.2 billion.
Investors assessed U.S. data through the week to gauge the outlook on the Federal Reserve's monetary policy, that could determine the trajectory of the dollar. The world's most influential central bank is expected to cut interest rates next week.
Meanwhile, Russia's rouble depreciated 2% against the dollar ahead of a central bank policy decision that is expected to leave borrowing costs at 18%, as signs of a cooling economy emerge.
Trading in major currencies in Russia has shifted to the over-the-counter market, obscuring price data.
The yield on Turkey's short-term bonds rose 29 basis points, while rate-sensitive bank stocks fell 0.6% as a survey showed expectations that inflation would slow to 43.14% by year-end, a rate that is still above the central bank's 36% target.
In central and eastern Europe, Poland's zloty was little changed after data confirmed an earlier reading that showed inflation in August stayed at 4.3%. The currency has outperformed peers in the region year-to-date as the central bank has left interest rates unchanged this year.
"The persistence of core inflation means that the (monetary policy committee) will not be in a hurry to start reducing interest rates, and the monetary policy easing cycle itself will be cautious and less aggressive than the market estimates," analysts led by chief economist, Rafał Benecki at ING Bank said.
Investors will monitor an investigation starting on September 24 into government accusations that central bank Governor Adam Glapinski may have broken the law.
In Africa, the rand was flat, though up around 3% so far this year, ahead of inflation data and a central bank rate decision bank next week.
Yields on Sri Lankan hard currency bonds expiring in 2029 slipped over 270 bps ahead of elections in the following week. A report said bondholders and the government were holding a fresh round of talks, as the island nation tries to emerge from a debt crisis.
Maldives' Islamic dollar bond rose for the fifth day - up by over 3 cents on the dollar - as the archipelago nation vowed to avoid a debt default.
(Reporting by Johann M Cherian in Bengaluru Editing by Christina Fincher )