Turkish lira, bonds ease on geopolitical worries, EM sell-off

ISTANBUL, Oct 8 (Reuters) - Turkish lira and bonds eased inthin trade on Monday, with geopolitical risks weighing afterbombardments between Syria and Turkish forces in the southeastof the country over the weekend.

Emerging markets were also weakened on Monday after theWorld Bank cut its growth forecast for the East Asia and Pacificregion, including China while a fall in oil prices pushedRussian equities down 1.5 percent.

Sunday was the fifth consecutive day of Turkish retaliatorystrikes against incoming bombardments from northern Syria, wherePresident Bashar al-Assad's forces have been battling rebels whocontrol swathes of land near the Turkish border.

By 1508 GMT, the lira weakened to 1.8115 against the dollar

from 1.7946 late on Friday. Against its euro-dollarbasket , the lira eased to 2.0802 from 2.0700.

"We see outflows from Turkey due to the tensions with Syriaand the sell-off in South Africa's rand. The lira can continueto weaken until 1.83 against the dollar," said Burcin Metin,head of the forex desk at ING Bank.

The yield on the two-year benchmark bondclosed at 7.68 percent, from a previous close at 7.57 percent.Traders said the trading was thin due to a U.S. holiday.

Turkey's main share index closed up 0.08 percent at67,435 points, outperforming a 1.18 percent fall in the emergingmarkets index .

Turkish markets shrugged off an International Monetary Fundstatement saying Turkey was continuing to face some considerablerisks given the large current account deficit and the volatilenature of global capital flows in an uncertain externalenvironment.

(Writing by Seltem Iyigun; editing by Ron Askew)

((seltem.iyigun@thomsonreuters.com)(+90 212 350 70 62)(ReutersMessaging: seltem.iyigun.thomsonreuters.com@reuters.net))