In Emerging Markets Stocks at 9-month highs; Nigeria, Hungary and Egypt central banks meet

MSCI's benchmark pan-EM index was just about holding 0.2 percent gains as a mild wave of caution drifted in ahead of key Federal Reserve and Bank of Japan meetings in the coming days and as commodity prices dropped lower.

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Russian president, Vladimir Putin

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Emerging market stocks dug in at nine-month highs on Tuesday ahead of a flurry of central bank meetings, including a possible rate hike in Nigeria where the recently unshackled naira was bobbing at a record low.

MSCI's benchmark pan-EM index was just about holding 0.2 percent gains as a mild wave of caution drifted in ahead of key Federal Reserve and Bank of Japan meetings in the coming days and as commodity prices dropped lower.

Nigeria's naira was slumped at 310 per dollar as analysts predicted the central bank would be forced to hike interest rates despite the renewed weakening of oil which brings in the bulk of its revenues.

The latest poll by Reuters shows economists expect Lagos to lift its rates to 13 percent from their current 12 percent.

"With inflation at 16.5 percent if they want to really deliver a positive credibility shock they need to do 500 basis points, though I doubt they will," said UBP Asset management's EM Macro and FX strategist Koon Chow.

Hungary, which has been emerging Europe's top performing market again this year, was also holding a rate meeting as was more turbulent Egypt, where speculation continues about a devaluation of the dollar-pegged Egyptian pound.

The pound has weakened to unprecedented 13 to the dollar on the black market this week on expectations of an FX shift as an acute dollar shortages hamper trade in the import-dependent country.

Hungary's forint, in contrast, remains relatively strong and has been on a near-constant rise against the euro over the last month after being whacked prior to that by Britain's vote to leave the European Union.

The National Bank of Hungary is expected to keep its main interest rates on hold at its meetings on Tuesday, having taken another unconventional easing measure recently by reducing local banks' options to hoard their funds.

"I think they will keep their powder dry for now," said UniCredit EM strategist Kiran Kowshik. "Rates are already at record lows, although they will probably still send a dovish signal."

Turkish markets looked to have finally calmed after some dramatic falls over the last week in the wake of a failed coup attempt and a subsequent clamp down on rights by the government.

Stocks in Istanbul and the lira were both barely budged, the former having bounced 3 percent on Monday.

There was signs too that tensions between Turkey and regional power Russia were thawing.

Russian President Vladimir Putin will meet Turkish President Tayyip Erdogan in the first half of August as the two countries look to gradually unfreeze relations, Turkish Deputy Prime Minister Mehmet said on a visit to Moscow.

"We are here to improve our relations and to bring them to an even higher level than before Nov. 24," Simsek said referring to downing of a Russia fighter jet near the Syrian border last November.

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