*

Shanghai Composite index logs biggest weekly gain since

2008

*

Sri Lanka holds rates, sees rosy inflation, growth outlook

*

Ghana interest rates decision due

*

Senegal dollar bonds fall after audit reveals larger debt,

deficit

*

Stocks up 1%, FX up 0.3%

By Ankika Biswas

Sept 27 (Reuters) - An emerging market stocks index eyed

its biggest weekly jump in almost four years on Friday, as an

improved economic outlook spurred a buying spree in heavy-weight

China shares, while the currencies index was set for its longest

weekly winning streak since 2015.

The Shanghai Composite index climbed nearly 3% on

the day, logging its biggest weekly gain of nearly 10% since

2008, while China's blue-chip CSI300 jumped 4.5% and

notched its best week since 2014.

The MSCI index for EM stocks rose 1%, climbing for the

seventh straight session and defending its two-year high levels.

Hong Kong's Hang Seng index also jumped 3.2%, rising for

the fourth straight day.

Investors welcomed China's central bank's plans to cut the

amount of cash that banks must hold as reserves by 50 basis

points, the second reduction this year aimed at bolstering a

faltering economic growth.

"Policy had already succeeded in loosening financial

conditions modestly over the past three months, even prior to

the latest package of policy measures announced on Tuesday,"

according to abrdn's Global Macro Research team.

"This (50-bps cut) will provide a welcome boost to

disposable income and may help consumer sentiment to recover

over time."

The MSCI index for EM currencies rose 0.3%, standing at

record-high levels, set to log its ninth straight weekly

advance.

China's stimulus cheer was another boost for EM stocks and

currencies, which have already been riding high on expectations

of a U.S. interest rate cut, only to be met with a

larger-than-usual 50-bps reduction by the U.S. Federal Reserve

last week.

Indian shares hit fresh record highs, on track for their

third consecutive weekly rise, while South Africa's main stock

index also hovered around record highs.

Sri Lanka kept interest rates unchanged, as expected, citing

domestic and global uncertainties, but said inflation was likely

to remain low and the economy was doing much better than

initially expected.

Further, the International Monetary Fund said it was already

communicating with Sri Lanka's new economic team.

The country's benchmark stock index was 0.5% higher,

and the rupee strengthened 0.2% against the dollar.

Meanwhile, Senegal's sovereign dollar bonds fell after a

government audit revealed larger debt and deficit figures than

the previous administration had reported. The 2033 maturity fell

1.8 cents to bid at 85.06 cents on the dollar, while the 2048

issue was down by 1.7 cents, Tradeweb data showed.

Also on investors' watch list for the day were Ghana's

interest rate decision and Zambia's 2025 national budget.

HIGHLIGHTS:

** Pakistan wins more financing assurances from China, UAE,

Saudi IMF official says

** African countries eye world's first joint

'debt-for-nature' swap