* Emerging stocks bounce 0.4 percent after Fed
* Rouble pulls back; authorities signal measures to curb FX
* Rand rises on gold price; inflation back in target band
By Sujata Rao
LONDON, Nov 25 (Reuters) - Emerging stocks rose 0.4 percent
on Wednesday due to the Federal Reserve's positive assessment of
the U.S. economy while the rouble eased after a rate cut and on
signs Russia will step up efforts to curb speculative inflows.
World stocks were higher after the U.S. central bank in the
minutes of its latest meeting expressed confidence in the
durability of the economic recovery and raised 2010 growth
forecasts. Also higher gold and oil prices along with a weaker
dollar were giving a boost to emerging markets.
The MSCI emerging index rose half a percent <.MSCIEF>.
"The market has chosen to interpret the Fed minutes to say
that any exit strategy is a long way off. They talked of zero
interest rates fuelling risk taking but they seem unwilling to
do anything about it ... that's been taken as a signal that the
risk rally can continue a while longer," said TD Securities
chief emerging markets strategist Beat Siegenthaler.
Siegenthaler said talk by emerging central banks about steps
to cap currency strength is weighing on investors' minds and
could keep a lid on emerging market gains until year-end.
"But unless banks take drastic action which most of them
will not ... the rally should continue until year-end but maybe
at a slower pace," he added.
Russia is the latest country where talk of capital controls
has surfaced, following measures across South America and Asia.
The rouble eased 0.3 percent to a five-day low versus its
euro-dollar basket <RUS=MCX> after a half point rate cut and
comments from a central banker and the finance minister.
Tuesday's rate cut took rates to a record low 9 percent and
took cumulative easing this year to 400 basis points.
Finance Minister Alexei Kudrin said local stock markets had
become overheated due to speculative overseas flows but said
only soft measures would be needed to combat this. The central
bank has already pledged some measures to cap the rising rouble,
including changing reserve requirements. [].
"These are significant comments...net-net we now have a
firmer message from the Russian authorities that they are less
likely to tolerate rouble appreciation, which will likely cap
rouble strength over the next few months," said Tim Ash, head of
emerging Europe research at RBS.
"Assuming oil prices remain elevated we should expect
further rate cuts plus heavy FX intervention," he added.
UKRAINE, SOUTH AFRICA
The picture was also brighter for Ukraine where the acting
finance minister reassured investors the country would pay the
December coupons on its Eurobonds and that debt restructuring
efforts by the state railway carried no danger of cross default.
Ash said an affirmation of Ukraine's rating by Moody's had
helped, as had news that Russia had relaxed gas import demands
on Kiev and waived fines on this year's supply [].
"A few things seem to be coming together for Ukraine," he
said. "Much of the bad news is already priced in."
Five-year credit default swaps for Ukraine reflected this,
upfront fees falling to 29.5 percent from 30.5 in the previous
session while in Romania, mired in political stalemate, CDS fell
to 288.9 basis points from 292.7, CMA DataVision said.
The gainer of the day was South Africa which saw stocks up
almost one percent <.JTOPI> and the rand <ZAR=> at a one-week
high against the dollar, thanks partly to record gold prices.
Latest data showed consumer inflation back within the
central bank's 3-6 percent target band for the first time in
2-1/2 years []. The economy has also finally
returned to growth after three quarters of contraction.
In central Europe, all eyes were on Poland where the central
bank is expected to keep rates steady at 3.50 percent.
In bond news, Dubai sold $5 billion in bonds to two UAE
banks [] as part of a $20 billion borrowing plan.
JP Morgan's EMBI Plus index <11EMJ> saw yield spreads versus
U.S. Treasuries fall 4 bps to 306 bps.
(Additional reporting by Carolyn Cohn; editing by Chris Pizzey)
((sujata.rao@thomsonreuters.com; +44 207 542 6176; Reuters
Messaging: sujata.rao.reuters.com@reuters.net))
