Lira volatility gauges at record high EM stocks reverse some of Monday"s losses Dec 21 (Reuters) - The Turkish lira hit its strongest level in a month versus the dollar in volatile trading on Tuesday, building on the previous day"s 25% rally that followed President Tayyip Erdogan announcement of support for the battered currency. Broader emerging market currencies and stocks recovered from losses that were spurred by fears around the fast-spreading Omicron virus variant. read more The lira rose about 5% to 12.51 per dollar after rocketing some 25% on Monday. The currency had hit a record low of 18.4 to the dollar before closing at 13.15 after Erdogan introduced a series of steps he said will ease the burden of the weakened currency on Turks and will encourage them to hold lira savings rather than dollars. read more The measures included a government pledge to guarantee deposits in lira. Turkish Finance Minister Nureddin Nebati is set to announce the details at 1100 GMT. "We recognise that this scheme may alleviate upward pressures on the currency in the near-term by altering households" portfolio choice in favour of the lira," Citi"s Ilker Domac wrote in a note. "However, we believe that the new measures alone are unlikely to bring lasting stability in the absence of a productivity driven improvement in the country"s external performance and a more predictable macroeconomic environment." Erdogan"s push for interest rate cuts since September has set off Turkey"s worst currency crisis in two decades, with the lira crashing nearly 40% in just the five weeks to last Friday. Lira volatility gauges jumped to record highs , , , , while some of the dollar-denominated government bonds rebounded and equity markets (.XU100) wilted again. read more Lira volatility hits record hit Lira volatility hits record hit Overall, MSCI"s index of EM currencies (.MIEM00000CUS) edged up 0.2%, while its equities counterpart (.MSCIEF) rose 0.9% after falling to a one-year low on Monday. Russia"s rouble steadied along with oil prices, while Poland"s zloty and the Hungarian forint all made gains against a dollar on the back foot. Among stocks, Chinese equities bounced (.CSI300), (.SSEC), with property stocks in the lead on growing signs of government support as Beijing sought to prevent contagion from China Evergrande Group"s debt woes and several other heavily indebted developers. read more Meanwhile, the International Monetary Fund is set to start discussions on an extended credit facility with Mozambique next month, its first potential programme with the country since suspending support in 2016 when evidence of $2 billion in secret loans emerged. read more For GRAPHIC on emerging market FX performance in 2021, see http://tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance in 2021, 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 Sruthi Shankar in Bengaluru; Editing by Frank Jack Daniel