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EMERGING MARKETS-Russian rouble drops as geopolitical tensions rise; EM stocks hit 7-month high

* U.S. joins EU in support of Navalny’s illness probe

* Belarusian rouble extends slide; all eyes on Russia

* Lira rises 0.4%; up for the first time in five sessions

* Ankara, Athens agree to talks over Mediterranean dispute

* U.S. consumer data, Fed review eyed

Aug 26 (Reuters) - Russia’s rouble slid on Wednesday on mounting international pressure to probe the suspected poisoning of a Kremlin critic and on tensions in Belarus, while emerging market shares hit a seven-month peak with eyes on U.S. data and the Federal Reserve.

MSCI’s index of emerging market stocks extended gains to a fourth straight session, up 0.2%, but main indexes in individual countries were mixed ahead of the U.S. data expected to show a slowdown in durable goods orders.

This would come hot on the heels of numbers that showed U.S. consumer confidence dropped to a more than six-year low amid rising unemployment due to the coronavirus pandemic.

A key speech by the U.S. Federal Reserve chairman on Thursday is likely to give a peek into the bank’s policy stance. The dollar made narrows moves ahead of it, helping some emerging market currencies to gain.

But, “the uncertainty about the long-term effects of corona on exchange rates is likely to pre-occupy the market for many quarters and is likely to keep fluctuation intensity high,” warned Ulrich Leuchtmann, an FX analyst at Commerzbank.

Russia’s rouble declined 0.4% to stay near its lowest in almost four months hit in the previous session. United States on Tuesday endorsed a European Union-led investigation into the illness of Alexei Navalny after the clinic he’s being treated at in Berlin found indications of poisoning.

In former Soviet state Belarus, the currency fell to five-month lows again the dollar while against the euro it stayed at all-time lows amid massive protests against President Alexander Lukashenko.

Lukashenko’s fate is widely seen as being in the hands of the Kremlin which has stressed there should be no attempt by Western powers to “pressure” Belarus, including via sanctions. Investors fear that would trigger a Russian-backed crackdown which could exact a toll on Russian assets.

Turkey’s lira broke a four-day losing streak against the dollar after Germany mediated between Turkey and Greece and said the two NATO allies were ready for dialogue to defuse a worsening dispute over energy resources in the Mediterranean.

Meanwhile, coronavirus cases in Turkey jumped on Tuesday to their highest level since mid-June, prompting the government to impose measures such as reduced personnel at workplaces to curb the spread of the pandemic.

Hungary's forint continued to decline a day after the central bank left interest rates unchanged as expected. The government plans to finance an increased budget deficit by boosting its forint-denominated government bond sales, the debt management agency AKK said on Wednesday. For GRAPHIC on emerging market FX performance 2020, see tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance 2020, see tmsnrt.rs/2OusNdX

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For CENTRAL EUROPE market report, see

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For RUSSIAN market report, see

Reporting by Susan Mathew in Bengaluru; Editing by Shailesh Kuber

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