(Bloomberg) -- The iShares MSCI Emerging Markets Index declined the most in six weeks after the Federal Reserve outlined its plan for exiting stimulus measures that have spurred a rally in developing-nation equities.

The exchange-traded fund slumped 2.1% to $38.57 at 4 p.m. in New York. The MSCI Emerging Markets Index dropped 0.2% to 950.59. Russia’s Micex Index led declines among major developing-nation equity benchmarks. China’s yuan retreated below 6.20 per dollar for the first time since April, while the overnight money-market rate advanced to a one-month high and property companies spurred a slide in stocks.

U.S. central bank officials predicted their target interest rate will be 1% at the end of 2015 and 2.25% a year later, higher than previously forecast. Fed Chair Janet Yellen said the stimulus program could end this fall and interest rates could rise six months later. The benchmark gauge for shares in developing nations has retreated as much as 16% since May 22, when the Fed signaled its bond-buying could be trimmed if the economy showed sustained improvement.

“It’s a ‘risk-off’ response,” Michael Holland, who oversees more than $4 billion as chairman of Holland & Co. in New York, said in a phone interview. “When there’s any question about whether the Fed might take off, than the market has the kind of response we had today.”

Brazil’s Ibovespa rose for a third day as health-insurance broker Qualicorp SA surged after fourth-quarter earnings exceeded analysts’ estimates. Petroleo Brasileiro SA, the government-controlled oil company, contributed the most to the gauge’s advance.

RUSSIA, CHINA

The ruble strengthened for a third day as Russia pushed on with its annexation of Crimea and investors wagered the impact of Western sanctions will be mild. The Micex Index, which slid into a bear market last week, dropped 1.3%, snapping the biggest two-day advance since May 2010.

The Shanghai Composite Index fell as the collapse of a private developer spurred concern the industry may face defaults. China Vanke Co. and Poly Real Estate Group Co., the nation’s biggest developers, slumped at least 1.3%.

The overnight repurchase rate, a gauge of interbank liquidity, rose 57 basis points to 3.46% in Shanghai, the highest since March 4, according to a weighted average from the National Interbank Funding Center.

The premium investors demand to own emerging-market debt over U.S. Treasuries fell 0.11 percentage point to 311 basis points, according to JPMorgan Chase & Co.

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