* Rouble had surged on de-escalation of Ukraine tensions
* Russian central bank expected to hike by 25-50 bps
* Turkish lira worst EMEA performer this week
By Ambar Warrick
April 23 (Reuters) - Russia's rouble rose on Friday before a widely expected interest rate move as tensions with Ukraine de-escalated, while most emerging-market currencies fell but were set for a third week of gains on continued dollar weakness.
The rouble RUB= rose about 0.2% to a one-month high of 75.0350 to the dollar. It had jumped 1.6% on Thursday after Russia said it was withdrawing troops from near the border with Ukraine, apparently calling an end to a military buildup that had alarmed the West. stocks .IMOEX fell 0.3%. The MSCI's index of EM stocks .MSCIEF rose 0.6%
Investors were now anticipating a rate decision by the Russian central bank at 1030 GMT. It's expected to raise rates by 25 to 50 basis points amid growing calls from the government to rein in inflation.
"The underlying dynamics reflect a continued acceleration in price pressures. At its 19 March directors' meeting, the Central Bank ended its easing cycle and hiked the policy rate 25 bps to 4.5%; we expect another hike of 50 bps, followed by a similar hike at the next meeting," analysts at TS Lombard said.
"Headline year-on-year CPI will likely dip in April on base effects before resuming its upward trajectory."
The MSCI's index of emerging-market currencies .MIEM00000CUS rose 0.1% on Friday and was set for a third straight week of gains, as weakness in the dollar and Treasury yields made risk-driven assets appear more attractive.
But a damaging new wave of COVID-19 cases across the developing world hurt emerging-market assets. Bank of America (NYSE: BAC ) flows data showed investors pulled back $1.3 billion from emerging-market equities in the week to Wednesday. rupee INR= was set for a weekly loss of 0.4%, as a record-high COVID-19 infection rate in the country hammered its risk assets with the prospect of more lockdown measures.
Turkey's lira TUR= was the worst-performing currency across Europe, the Middle East and Africa this week and was set for weekly losses of 3.4%. It fell 0.3% on Friday, as a local holiday kept trading light.
The lira came under pressure from the possibility of further deterioration in Washington-Ankara ties, as reports suggested the United States was gearing up to formally recognise the massacre of Armenians by the Ottoman Empire during World War One as an act of genocide. central Europe, Hungary's forint EURHUF= rose 0.1% against the euro, on optimism over plans to scale back some virus curbs as vaccinations neared 40% of the population.
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