EMERGING MARKETS-Stocks pummelled by Fed jitters; lira hits record low on surprise rate cut

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South Africa cenbank decision due 1300 GMT

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Turkey's lira touches record low of 18.42 vs dollar

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Brazil holds interest rates after 12 straight hikes

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Indonesia raises rates for 2nd straight month

(Updates with Turkey central bank decision, comments; updates prices, replaces graphic)

By Anisha Sircar and Amruta Khandekar

Sept 22 (Reuters) - Emerging market currencies and stocks declined on Thursday after the Federal Reserve stuck to an aggressive tone on U.S. interest rates following its latest big hike, while Turkey's lira hit an all-time low after its central bank unexpectedly cut its policy rate.

The Fed on Wednesday lifted its policy rate by 75 basis points (bps) for the third time and projected raising rates further than investors had expected.

Broader EM currencies fell for a second straight day, down 0.4%, as the dollar hovered near two-decade highs.

Turkey's lira fell to a fresh record low of 18.42 to the dollar after the central bank cut its policy rate by 100 basis points to 12%, justifying the shock move by citing indications of a slowdown in the third quarter.

The bank also delivered a surprise cut in August despite its monetary easing helping drive inflation above 80%.

"As long as the lira holds, which it has been doing lately, they are more likely to cut than hike," said Per Hammarlund, chief EM strategist at SEB in Stockholm.

"The problem is with global interest rates rising and inflation staying high in Turkey, and potentially again rising due to the rate cuts and higher energy prices, they are in for a bumpy ride later on."

Broader EM stocks fell 1% to their lowest level since May 2020, tracking a global risk-off.

EM shares are now down more than 25% so far this year and are on pace for their worst year since the 2008 financial crisis, as markets digest a deteriorating global growth outlook on the back of surging inflation, aggressive tightening cycles and rising geopolitical risks.

South Africa's rand gained 0.8%, with investors eyeing a likely 75 bps hike by the South African central bank in a bid to help bring inflation back within its 3%-6% target range.

Hong Kong, meanwhile, raised its base rate by 75 bps to 3.5% in its first rate hike since September 2018, while the Philippine central bank raised rates by half a percentage point, as expected.

Indonesia hiked rates by a surprise 50 bps, while Taiwan hiked rates by 12.5 bps, reflecting continued concerns about inflation.

The rupiah pared most losses from earlier in the day to slip 0.1%, while Philippine's peso fell 0.7%.

Brazil's central bank on Wednesday held rates unchanged after 12 consecutive hikes, in line with expectations. For GRAPHIC on emerging market FX performance in 2022, see http://tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance in 2022, see https://tmsnrt.rs/2OusNdX

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(Reporting by Anisha Sircar and Amruta Khandekar in Bengaluru; editing by Uttaresh.V and Hugh Lawson)