(Updated at 0927 GMT)

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Yuan hits 8-month low as commodities currencies continue

slide

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Turkey to start gold, FX swap auctions for lira

sterilisation

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Polish govt to reform rules on communicating with central

bank

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South African inflation falls to 5.1% y/y in June

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MECI EM stocks indexes off 0.2%, FX flat

By Johann M Cherian

July 24 (Reuters) - Cautious sentiment prevailed across

most emerging markets on Wednesday, with Hungary's forint down

for a second day and investors still vexed by capital gains tax

hikes in India, while Sri Lankan stocks rose after a surprise

interest rate cut.

MSCI's index tracking bourses in developing markets

slipped 0.2%, while a currencies gauge

was broadly flat against the dollar.

In central and eastern Europe, the forint

slipped 0.4% against the euro to a one-week low, a day after the

central bank delivered its fifteenth successive rate cut on

signs of easing inflation.

Poland's zloty was flat. The government said it

will reform rules on communicating with the central bank when

preparing the budget, after the lender failed to contribute to

the state budget.

Meanwhile, Indian stock indexes lost 0.27%

and 0.35%, respectively with traders still disappointed a day

after the government hiked the tax rate on equity derivatives

trades and profit from equity investments during its annual

budget announcement.

"The authorities are trying to cool the surge in markets

just from a financial stability point of view and that's clearly

weighing a bit on sentiment," said Jakob Ekholdt Christensen,

senior EM strategist at BankInvest.

The indexes had been trading at record highs recently and

gained over 10% each year-to-date. Analysts broadly expected the

tax hikes to be a challenge in the short-term.

Elsewhere in south Asia, Sri Lankan stocks rose 0.9%

after the central bank unexpectedly cut interest rates by 25

basis points to help fuel the island nation's economic recovery

from its worst financial crisis in decades.

South Africa's rand firmed 0.2% after data showed

inflation fell to 5.1% in June on an annual basis, in-line with

expectations, but still above the local central bank's target of

4.5%, tempering expectations of imminent interest rate cuts.

Turkey's main equities index dropped 0.6%, a day

after the central bank left interest rates unchanged.

The lira slipped 0.2% and was trading near

record lows, with attention on the local central bank's decision

to implement measures to regulate the currency's excess

liquidity.

Meanwhile, Hong Kong stocks fell nearly 1%, led by

losses in electric vehicle makers NIO and Xpeng ( XPEV )

following a disappointing quarterly report from

U.S.-based Tesla.

China's yuan hit its lowest point in more than

eight months as commodities-linked currencies broadly lost

further ground on a bleak outlook for Chinese demand.

Nigeria's naira firmed 0.4% against the euro after

the local central bank hiked borrowing costs by 50 basis points

to 26.75% on Tuesday.