March 24 (Reuters) - Emerging market currencies slipped on Wednesday as worries about a new COVID-19 wave in Europe and potential U.S. tax hikes sapped demand for riskier assets, while the Turkish lira wobbled as investors continued to digest a shock central bank shake-up. The MSCI index of emerging market currencies fell 0.2% and was on course for its worst day in nearly two weeks as Germany extended its coronavirus lockdown and U.S. Treasury Secretary Janet Yellen said future tax hikes will be needed to pay for public investments, sending the dollar to near four-month highs. After firming for seven straight months last year on the back of a global economic rebound from the pandemic-driven recession, high-yielding currencies in emerging markets have taken a hit in 2021 as fears of higher U.S. inflation sent bond yields surging. “Additional depreciation pressure on (emerging market) currencies today cannot be ruled out as markets digest the news from the U.S. overnight and remain concerned about the spread of COVID-19 across Europe,” analysts at Mizuho Bank wrote in a client note. The Turkish lira fell 0.6% to 7.99 against the dollar, hovering near a record low of 8.58, after President Tayyip Erdogan on Saturday replaced a hawkish central bank chief with a critic of high interest rates. Interest rates on overnight swaps for the lira eased to 50% in early London trading on Wednesday after spiking to 1,400% on Tuesday, their highest in at least a decade, Refinitiv data showed. In Russia, the rouble sank to its weakest level this year and rouble-denominated Treasury bonds hovered near a one-year low as the market braced for imminent U.S. sanctions against Moscow. By 0928 GMT, the rouble had retraced some of its losses to trade around 75.78 against the dollar. The South African rand firmed about 0.7% following a decline of more than 1% in the previous session. All eyes this week are on a central bank policy meeting, due to conclude on Thursday, where the bank is expected to leave its benchmark lending rate unchanged. The Hungarian forint firmed another 0.3% against the euro a day after the Hungarian central bank left interest rates unchanged. The Czech crown marked time ahead of its own central bank meeting on Wednesday. The emerging markets equities index fell 1% to a two-week low, tracking declines in Asian and European equities. Hong Kong stocks led declines to post their lowest close in more than 10 weeks on concerns of global policy tightening. Turkey’s stock index stabilised after declining nearly 10% in the past two sessions. For GRAPHIC on emerging market FX performance in 2021, see tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance in 2021, see tmsnrt.rs/2OusNdX For TOP NEWS across emerging markets For CENTRAL EUROPE market report, see For TURKISH market report, see For RUSSIAN market report, see