EMEA FX Slips on Mixed Fed Signals, Stocks Inch Higher


CZK flat after strong rally on Wednesday

MSCI EM stocks index inches up, FX flat

Czech, Hungarian c.banks kick off rate hike cycles

June 24 Reuters Most emerging market currencies fell on Thursday as mixed signals from the U.S. Federal Reserve kept investors on edge about when the bank would begin unwinding its massive stimulus program.

The MSCIs index of EM currencies was flat, while most currencies in Europe, the Middle East and Africa EMEA retreated as the dollar hovered below 11week highs.

Turkeys lira dropped about 0.4, while South Africas rand shed 0.5. Investors were also watching for producer prices data from Africas most industrialized economy, due later in the day.

Russias rouble rose 0.2, helped by rising oil prices.

EM stocks rose slightly, with the MSCIs index adding about 0.2, tracking overnight gains on Wall Street. Relative stability in equities has also made them more attractive in comparison to foreign exchange, particularly in emerging markets.

Comments from Fed Chair Jerome Powell earlier this week had suggested that a recent spike in inflation would be transitory, and had sparked a small rally in emerging markets.

But overnight, two Fed officials said that a period of high inflation in the United States could last longer than anticipated, which supported the dollar.

Their comments, combined with the Feds unexpectedly hawkish tilt last week, saw investors fretting over the timeline of the Feds eventual policy tightening.

Bearing in mind…


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