* Emerging stocks firm on easing oil prices, Asian rally
* Czech crown leads CE-3 currency rebound
* Serb dinar consolidates, softens versus euro
* Israeli shekel slips to three-month lows
* Ukraine central bank seen openly bidding for euros
By Sebastian Tong
LONDON, July 24 (Reuters) - Emerging stocks firmed on
Thursday, supported by easing commodity prices and cheered by an
Asian stocks rally, while central European currencies rebounded
against a softening euro.
The decline in oil prices hit stocks in oil exporting Russia
<>, which slipped 1.26 percent to 14-week lows, but helped
lift emerging equities elsewhere.
At 1055 GMT, the benchmark stock index <.MSCIEF> was 0.36
percent higher to 1,053.65. while emerging debt spreads <11EMJ>
widened 5 basis points to trade at 277 bps over U.S. Treasuries,
but remained near their lowest in a month.
"The markets are stabilising a bit," said Carlin Doyle,
emerging markets strategist at State Street.
Sentiment was further boosted by the overnight Asian session
which saw the region's shares rise to three-week highs.
Local currencies were mixed, with some advancing against the
euro which slid on weaker-than-expected European economic data.
The Czech crown <EURCZK=> led the rebound in the three
central European convergence currencies, which corrected this
week from recent record highs as the region's central bankers
hinted at monetary policy easing.
The unit advanced 0.98 percent against the euro while the
Polish zloty <EURPLN=> had gained 0.97 percent and the Hungarian
forint <EURHUF=> was 0.72 percent higher.
"The Czechs are now starting to look for rate cuts. The
Czech Republic would be the first country in Europe to cut rates
since the Bank of England last cut, and a rate cut could easily
be replicated in Poland," said State Street's Doyle.
DINAR, RAND, SHEKEL
Serbia's dinar, which rose to seven-month highs this week on
the arrest of wartime leader Radovan Karadzic wanted for
genocide during the 1992-1995 Bosnian war, consolidated
early-week gains to soften 0.6 percent against the euro
<EURRSD=>.
The South African rand <ZAR=> softened 0.28 percent against
the greenback amid growing expectations of an easing in monetary
policy.
The country's re-weighting of its consumer price index as
well as declining commodity prices are likely to help it meet
its inflation target next year, said Citi in a research note.
"If inflation improves as we expect and growth remains weak,
a rate cut prior to June 2009 cannot be ruled out. In the longer
run though, we continue to expect that rates are unlikely to fall
sustainably below 8.5-9.0 percent," Citi analyst Jean Francois
Mercier said.
Interest rate expectations also hit the Israeli shekel
<ILS=>, which edged down 0.14 percent to hover at three-month
lows against the dollar.
"The rate market is overwhelmingly thinking that steady
rates are the most likely outcome of the July 28 (central bank)
decision," said BNP Paribas in a research note.
Meanwhile, the Ukrainian central bank was seen openly
bidding for euros for the second time this week, a move seen by
some market observers as signalling a shift away from a strict
dollar peg to a euro and dollar basket currency regime.
[]
The Ukrainian hryvnia <UAH=> was 0.27 percent weaker against
the dollar to trade at 4.62.
(Additional reporting by Carolyn Cohn; Editing by Victoria
Main)
