* Lira set for best day since early-2019
* MSCI EM stocks index at highest since early-2018
* Polish zloty rises after c.bank holds rates
Nov 9 (Reuters) - Emerging market stocks and currencies rose
on Monday as Joe Biden clinching the U.S. presidency increased
hopes of a less adversarial U.S. trade policy, with the lira
leading gains after a large shake-up in Turkey's top economic
The U.S. dollar sank to a 10-week low after Biden was
declared as the winner over the weekend, while China's yuan
and the Mexican peso - both recent targets of
U.S. trade pressure - marked strong gains.
Turkey's lira was the best performing currency for
the day, jumping as much as 4% off a record low after the
central bank's newly-installed governor Naci Agbal vowed to
"decisively" use all policy tools to rein in elevated inflation
Agbal replaced Murat Uysal, who was fired by Turkish
President Tayyip Erdogan after barely more than a year in
office. In another announcement, Finance Minister Berat Albayrak
said on Sunday he was resigning for health reasons.
The moves came in the wake of steep declines in the lira due
to concerns over dwindling foreign exchange reserves,
double-digit inflation and strains in Turkey's relationship with
its NATO allies.
While expectations of a rate hike saw the lira set for its
best day in nearly two years, analysts questioned the
implications of Usyal's ouster on central bank independence.
"Uysal was not the main reason for the TRY weakness. For a
long time, he did exactly what Erdogan had repeatedly demanded
in public: provided low interest rates," said Ulrich Leuchtmann,
head of FX and commodity research at Commerzbank.
"Only when that was no longer possible did he implement an
interest rate policy turn-around. And as a result, was
Turkish stocks added 2.4%.
Other currencies in Europe, Middle East and Africa marked
small gains, while stocks rallied. The MSCI's index of emerging
market stocks rose 1.3% to its highest level since
The polish zloty rose 0.5% after the country's
central bank held rates on Friday as it said the coronavirus
epidemic's economic impact would be less extreme in 2020 but the
subsequent recovery slower than it had forecast.
In Asia, China's yuan jumped to a more than
28-month high to the dollar, as markets priced in improving
Sino-U.S. trade relations after a change in U.S. leadership.
Morgan Stanley analysts said the currency stood to benefit
after the election, and recommended buying the yuan against the
For GRAPHIC on emerging market FX performance in 2020, see http://tmsnrt.rs/2egbfVh
For GRAPHIC on MSCI emerging index performance in 2020, see https://tmsnrt.rs/2OusNdX
For TOP NEWS across emerging markets
For CENTRAL EUROPE market report, see
For TURKISH market report, see
For RUSSIAN market report, see
(Reporting by Ambar Warrick in Bengaluru; Editing by Krishna