LONDON, July 31 (Reuters) - Emerging currencies including

the Indian rupee and the South African rand extended losses on

Wednesday, hit by weak data and doubts over central bank policy,

while equities slumped to two-week lows.

The rupee was most in focus, falling 0.3 percent and adding

to a 1.8 percent fall against the dollar in the

previous session, when the Reserve Bank of India appeared to

pedal back on its commitment to defend the currency at a time

when external funding is precarious.

The currency is headed for its biggest weekly loss since

September 2011, having fallen more than 3.3 percent versus the

dollar, and is close to record lows hit recently. However, it

pared some losses and bond yields fell slightly after the RBI

and the finance minister sought to reassure markets .

The Turkish lira fell 0.3 percent after data showed the

trade deficit widening further, with exports showing a 6 percent

decline. The South African rand fell 0.6 percent ahead of trade data that is expected to show that current

account financing remains a problem.

The moves come before central bank meetings in the United

States, the euro zone and Britain, all of which should reiterate

commitment to low interest rates, though the U.S. Federal

Reserve is likely to signal a gradual cutback in bond-buying.

U.S. 10-year Treasury yields are at three-week highs before

the Fed's 1800 GMT announcement.

'We are seeing substantial dollar moves against emerging

currencies...the market is biased for a stronger dollar because

at some point the Fed is going to announce a reduction in asset

purchases,' said HSBC strategist Murat Toprak.

While the tighter funding backdrop is adding to pressure on

emerging markets with financing deficits, currency fortunes also

hinge on the policy stances of individual central banks, Toprak

said, contrasting Turkey and India.

'There is (disconnect) between India's monetary policy

stance and the currency moves, there is no line in the sand,' he

said. 'In Turkey, the stance is clear vis-a-vis lira: 'we are

here to defend the currency if needed'.'

The Turkish central bank on Wednesday held off from holding

its usual one-week repo auction to keep liquidity tight.

Earlier, selling also hit the Korean won which fell 0.5

percent, while the Malaysian ringgit touched new

three-year lows. In emerging Europe, the Hungarian forint

touched a five-week low to the euro while the zloty

fell 0.3 percent.

Emerging equities fell 0.6 percent, shrugging off Chinese

pledges to keep economic growth steady but the main MSCI

emerging markets index was on track for a small monthly gain

after two months of losses.

(Reporting by Sujata Rao; Editing by Mark Trevelyan)

((sujata.rao@thomsonreuters.com)(+44 20 7542 6176

sujata.rao.thomsonreuters.com@reuters.net))

(Emerging Markets Prices from Reuters Equities Latest Net Chg % Chg % Chg on year Morgan Stanley Emrg Mkt Indx 947.85 -5.80 -0.61 -10.17 Czech Rep 915.62 -1.28 -0.14 -11.85 Poland 2322.92 +15.13 +0.66 -10.07 Hungary 18252.38 -18.56 -0.10 +0.44 Romania 5422.74 +24.32 +0.45 +5.30 Russia 1319.49 -6.92 -0.52 -16.28 South Africa 36662.80 +145.39 +0.40 +5.37 Turkey 74343.64 -77.15 -0.10 -4.94 China 1993.80 +3.73 +0.19 -12.13 India 19361.15 +12.81 +0.07 -0.34 Currencies Latest Prev Local Local close currency currency % change % change in 2013 Czech Rep 25)

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