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U.S. inflation data due at 1230 GMT

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Rand touches five-week low vs dollar

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EM bonds, equities outflow resume - BoFA

By Sruthi Shankar

May 31 (Reuters) - Emerging market stocks and currencies

were on track for weekly losses, strained by uncertainty around

U.S. interest rate path, election outcome in some of the biggest

economies around the world, and weak economic data from China.

Investors are awaiting April data on the U.S. personal

consumption expenditure (PCE) index - the Federal Reserve's

preferred inflation gauge - for fresh clues on when the U.S.

central bank will start easing its monetary policy.

"The PCE data are likely to test markets' pricing of a

higher-for-longer stance," analysts at ANZ Research noted.

"Improvements in the April CPI data suggest that the PCE

price deflator data will continue to point to disinflation. If

the data are in line with these estimates, it would indicate

that the improvement in inflation towards target is intact."

A surge in the U.S. Treasury yields this week put pressure

on risky emerging assets after a surprise uptick in U.S.

consumer sentiment in May dimmed hopes of rate cuts this year.

The MSCI's EM equities index dipped 0.7%,

languishing near a one-month low and on course for a 2.9% weekly

drop. Asian bourses including those in Hong Kong and

Indonesia were among the top drags during the week.

A widely watched index of EM currencies

slipped 0.1% and looked on track for its worst weekly

performance since April 8.

With the dollar on the front foot, South Africa's rand

slipped to a five-week low on fears the governing

African National Congress (ANC) could form a coalition with

radical parties after this week's election roiled markets.

Prices of South Africa's main internationally traded bonds

fell as much as 1.3 cents on the U.S. dollar. The fall was the

third in a row and left the bonds at their lowest level in

almost a month.

Investors are awaiting the final phase of voting in India

and presidential election in Mexico over the weekend to gauge

the political paths in one of Asia and Latin America's largest

economies.

Emerging market debt outflows resumed in the week to

Wednesday at $1.1 billion and EM equities outflows stood at $40

million, Bank of America said on Friday, citing figures from

data provider EPFR.

China's yuan weakened after an official factory

survey showed the country's manufacturing activity unexpectedly

contracted in May, signalling the world's second-largest economy

was struggling to get back on its feet.

Meanwhile, Saudi Arabia's government filed papers to sell a

new stake in state oil giant Aramco that could raise

as much as $13.1 billion, a landmark deal to help fund Crown

Prince Mohammed bin Salman's plan to diversify the economy.

HIGHLIGHTS:

** US-China meeting, Marcos speech in spotlight at security

summit

** Foreigners pulled money out of EM portfolios in April

after five months of inflows

For TOP NEWS across emerging markets

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For RUSSIAN market report, see