* Upbeat start to Xi-Biden meet lifts sentiment
* EM stocks rally for 7th straight session
* Turkey, S.African stocks scale record highs
* Hungary cenbank seen hiking interest rates by 30 bps to 2.1%
Nov 16 (Reuters) - Turkey’s lira hit a record low on Tuesday over fears of another central bank rate cut this week, while the Hungarian forint rebounded firmly away from eight-month lows on expectations of tighter monetary policy.
Most other emerging market currencies firmed, with China’s yuan hitting five-month highs as investors cheered a cordial opening to a key meeting between U.S. President Joe Biden and Chinese leader Xi Jinping, raising hopes that tariffs may be reduced.
That also helped EM stocks hit three-week highs in their seventh straight session of gains, the longest winning streak since February. Turkish and South African stocks hit all-time highs, while Dubai shares hit four-year peaks.
Chinese real estate stocks lent further support, as the embattled China Evergrande Group rose about 35% from September lows after it met a payment deadline and on some hope for policy intervention in the sector.
The lira weakened as much as 1.5% to a record low of 10.2 against the dollar, lagging behind EM peers this year, as it faces lower local interest rates amid surging inflation, risks of higher U.S. rates and rising oil prices.
The Turkish central bank is expected to cut its key rate to 15% from 16% this week, according to a Reuters poll, though inflation remains near 20%.
“There are risks of (more cuts in Turkey) leading to a full blown balance-of-payment crisis,” said Jason Tuvey, senior EM economist at Capital Economics.
Hungary’s forint rose as much as 0.5% against the euro. The country’s central bank is seen hiking rates by 30 bps to 2.10%, ramping up the pace to match regional peers.
Data on Tuesday showed Hungary’s economy grew by an annual 6.1% in the third quarter, below analyst forecasts. The central bank on Monday highlighted the return of deficits in its budget and current accounts.
South Africa’s rand steadied as traders awaited the South African Reserve Bank’s monetary policy due on Thursday, following domestic inflation and retail sales data on Wednesday.
Oil exporter Russia’s rouble remained under pressure from geopolitical concerns related to the Russian military buildup near Ukraine.
“In general, political tensions have been weighing on the rouble a little bit and in terms of an outlook, we expect a bit more weakness. The way Washington reacts to the political tensions at Russia’s borders will play a key role in how the currency moves,” Capital Economics’ Tuvey said.
Reporting by Shashank Nayar and Susan Mathew in Bengaluru; Editing by Ramakrishnan M.