Nov 14 (Reuters) – Most emerging markets stocks inched up while currencies were subdued on Tuesday ahead of key U.S. inflation data that could offer more clues on the Federal Reserve’s interest rate outlook.
MSCI’s index tracking emerging markets equities edged 0.2% higher, while a basket of regional currencies was muted at 0921 GMT.
“Emerging markets are trading mixed ahead of the US data … suggesting caution.” said Shaun Murison, senior market analyst at IG markets.
Financial markets will be closely watching the world’s largest economy’s October inflation data, due later in the day, with economists expecting a headline increase of 3.3%, easing from 3.7% in September.
The data comes after Fed officials including Chair Jerome Powell last week said they were still not sure that interest rates are high enough to tame inflation.
Heavyweight Chinese shares rose 0.3% ahead of key domestic economic data this week, while investors will keenly monitor talks between U.S. President Joe Biden and Chinese President Xi Jinping.
“In person talks between the leaders of the two largest economies in the world are seen as a positive at face value,” said Murison, while adding trade tensions were likely to remain.
China’s central bank is widely expected to boost its liquidity injections but keep the interest rate unchanged when it rolls over maturing medium-term policy loans on Wednesday, a Reuters survey showed.
Reuters on Tuesday reported China had ordered local governments to halt public-private partnership projects identified as “problematic” as it tries to curb municipal debt risks.
Across Central and Eastern Europe, Hungary’s economy increased by 0.9% on a quarterly basis in the third quarter as it returned to growth after tipping into recession last year, data showed, while activity in Poland, Romania and Slovakia also expanded in the period.
Against the euro, the Hungarian forint was subdued, the Romanian leu slipped 0.1%, while the Polish zloty rose 0.2%.
The South African rand strengthened 0.1% against the dollar after data showed the domestic unemployment rate fell to 31.9% in the third quarter from 32.6% in the second quarter.
The Russian rouble firmed to a 3-1/2 month high against the dollar in early trade, buoyed by exporters’ foreign currency sales, high interest rates and recovering oil prices.
The rouble was last up 0.6%.
(Reporting by Siddarth S in Bengaluru Editing by Mark Potter)
