By Twesha Dikshit

March 17 (Reuters) - Emerging market stocks advanced on Tuesday, led by Asian markets that drove higher on AI optimism, as investors monitored a busy week of central bank meetings and continuing updates from the Middle East conflict.

Iran renewed attacks on the United Arab Emirates, with the U.S.-Israeli war on Iran in its third week and showing no signs of abating. The Strait of Hormuz remained largely closed off, lifting energy prices and concerns over inflation.

U.S. allies rebuffed President Donald Trump's request for help to reopen the crucial waterway, while the Israeli military said it had drawn up detailed plans for at least three more weeks of war. Oil prices bounced back almost 4% as supply concerns persisted.

Investor focus will be on a busy week of central bank meetings with policymakers in Brazil, Taiwan, Ukraine, the Czech Republic, Russia and the United States slated to meet. All will navigate expectations of a rise in inflation due to the oil surge amid ongoing tensions in the Middle East.

"What will be more important is the statements coming from the banks as they pertain to the tradeoff between economic growth and inflation," Tom Nelson, head of market strategy at Franklin Templeton Investment Solutions, said in a note.

"We will be looking for clues as to whether central banks are focused more on the inflationary impacts of the war in Iran or the effect on consumers and their ability to spend."

The MSCI index of emerging market equities .MSCIEF rebounded 1%, partially recovering from an almost 2% weekly loss. A corresponding gauge of currencies .MIEM00000CUS rose 0.3%.

Bourses in the Middle East were mostly higher with those in Egypt .EGX30 and Dubai .DFMGI adding 2.5% each. Stock markets in emerging Europe rose marginally, while Greece .ATG was flat after early declines.

JPMorgan cut its rating on Greece from "overweight" to "neutral". Analysts at the bank said: "Neither a long closure of the Strait of Hormuz nor rising global recession risks (are) priced into CEEMEA."

The Hungarian forint EURHUF= remained under pressure, dipping 0.5% against the euro. Other regional currencies were muted, while the Czech crown EURCZK= ticked lower.

Over in Asia, equities rose with AI-heavy Korea .KS11 and Taiwan .TWII adding about 1.5% each, aided by Nvidia's bullish forecast for chip demand. Stock indexes in Thailand .SETI, Singapore .STI and Indonesia .JKSE were up between 1.2% and 2.1%.

Indonesia's central bank held rates steady, as widely expected, with Governor Perry Warjiyo saying a new policy on foreign currency transactions would be issued to support the rupiah IDR= and applicable from April.

Meanwhile, Trump said he was attempting to delay a highly anticipated trip to China in early April by about a month due to the war in Iran.

For TOP NEWS across emerging markets nTOPEMRG

For CENTRAL EUROPE market report, see CEE/

For TURKISH market report, see .IS

For RUSSIAN market report, see RU/RUB

(Reporting by Twesha Dikshit; Editing by Andrew Heavens)

((Twesha.Dikshit@thomsonreuters.com;))