* More rate hikes this year - Russian central bank * Rouble hits 71.50 after rate hike * Turkish lira cuts gains, last up 0.3% * Dollar edges higher (Recasts after Russian central bank decision) June 11 (Reuters) - Russia’s rouble hit session highs on Friday after the central bank raised its key rate amid rising inflation, while a recovering dollar saw most other emerging market currencies pare some gains. The rouble hit 71.50 after the central bank raised the rate by 50 basis points to 5.50% and said more rate hikes through the year were likely, with inflation above target. The rouble was last trading up 0.3% at 71.63 to the dollar. “Given the CBR has been quite open in their communication around further rate hikes being imminent this year, aggressive rouble appreciation over the medium term is unlikely,” said Ima Sammani, an EM FX analyst with Monex Europe. “However, we expect the (central bank’s) decision to still moderately support the rouble going forward.” The dollar edged higher from a fall spurred by investors looking past higher than anticipated U.S. inflation on Thursday. MSCI’s index of EM currencies stayed at its highest on record. {FRX/} Turkey’s lira jumped as much as 1.9% before giving up some gains to trade up 0.3%, setting itself up for its best week in nearly three months. During U.S. President Joe Biden’s visit to Europe, investors hope that he and Turkish counterpart Tayyip Erdogan will discuss differences over Ankara’s planned purchase of Russian S-400 air defence systems which are incompatible with NATO’s defences. Turkish bonds were on their longest winning streak since November and are now back within touching distance of where they were before Erdogan sacked hawkish central bank governor Naci Agbal back in March. Reduced implied volatility also aided inflows into the lira, as did a central bank survey that showed the forecast for 2021 GDP growth had been raised to 4.9% from 4.3%. Official data showed Turkish industrial output surged 66% year-on-year in April, exceeding forecasts and expanding for an 11th straight month. South Africa"s rand ZAR- rose as much as 0.6%, before cutting some gains to trade up 0.2%. Its rise was not enough to pull the best performing EM currency this year into the black for the week. As well as a general consolidation in FX markets this week, South Africa was officially declared to be in its third wave of COVID-19 infections on Thursday, as the continent’s worst-hit country registered 9,149 new cases. Stocks in the developing world were also on a stronger footing as investors bought into the U.S. Federal Reserve’s view that a period of higher inflation was transitory. MSCI’s EM stocks index rose 0.3%, bringing it to positive territory for the fourth straight week - its longest winning streak since January. For GRAPHIC on emerging market FX performance in 2021, see tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance in 2021, see 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 Susan Mathew in Bengaluru; Editing by Simon Cameron-Moore and Nick Macfie Our Standards: The Thomson Reuters Trust Principles.