You probably don't want to do this. Wanting to use variable variables is usually a sign of a failure to understand data structures and/or excessive cleverness. If you really want to do this, you could say something like...
extract(array_fill_keys($letters, array()));
...but it would be best if you didn't. Using nested arrays is probably a much better idea - especially since you can just say $nested['a'][] = 5
and PHP will append the value to the array, creating one if nothing is there. Alternately, you could just say $varname['key'] = 123
and, again, PHP will auto-create the array for you.