May 1 (Reuters) - Emerging-market currencies edged higher on Wednesday in holiday-thinned trade as investors waited for the U.S. Federal Reserve’s latest decision on monetary policy. Stock markets were closed in most regions.
MSCI’s index for developing-world currencies rose. Dollar gains were limited by the euro’s, which rose after strong growth figures from the euro zone on Tuesday.
Focus largely remained on the Fed, which is expected to leave borrowing costs unchanged as it maintains a “patient” stance amid strong economic growth.
A dovish stance from the Fed is considered favourable for emerging-market currencies, but their performance so far this year has been mixed against the dollar, which has benefited from money flowing into U.S. assets.
“Countries that are more U.S.-facing have outperformed those that are more European-facing with growth in the former far outpacing growth in the latter,” said Christian Lawrence, an EM FX analyst at Rabobank in a note on Tuesday.
Among the currencies that were trading, South Africa’s rand and Turkey’s lira both added about 0.2 percent, the latter snapping a nine day losing streak.
Turkish Central Bank Governor Murat Cetinkaya said on Tuesday interest rate increases remained an option if inflation unexpectedly jumps.
Russia’s rouble was little changed as crude oil prices fell.
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