* EM equities set for weekly falls
* China weighs on stock markets
* Rising yields also depress mood
Aug 18 (Reuters) - Concerns about U.S. interest rates staying higher for longer and mounting evidence of weakness in China's property sector sent emerging market equities on course for their worst weekly performance in nearly two months on Friday.
The MSCI EM index slipped 0.9%, falling for a seventh consecutive session, with heavyweight Shanghai shares shedding more than 1% because of a lack of concrete stimulus to boost consumption and support the real estate sector.
After local markets closed on Friday, China's securities regulator said it would cut trading costs, support share buybacks and introduce long-term capital as part of measures to revive the stock market.
The spot yuan firmed against the dollar after the central bank set the daily fixing much higher than expected, though the offshore yuan slipped 0.2%.
Developer China Evergrande Group earlier filed for bankruptcy protection in a U.S. court as part of one of the world's biggest debt restructuring exercises.
In isolation, the news would have prompted alarm, but when combined with its peer Country Garden's decision to suspend payments on some of its bonds, "the words 'dominos' and 'falling' start to come to mind," said AJ Bell investment director Russ Mould.
Most EM currencies including the Turkish lira and South African rand steadied as the dollar eased from two-month highs.
Ahead of Turkey's interest rate decision next week, a survey from the central bank showed it expects the consumer price index to be at 59.46% by the end of 2023, up from the previous forecast of 43.82% in July.
The struggling lira was flat at 27.11 per dollar, trading near record low levels.
The Russian rouble firmed against the dollar, and was set to gain more than 6% in what has been one of its most volatile weeks all year, with the market on alert for capital controls.
An index of emerging market currencies edged up 0.1% but was set for its third consecutive week of declines, dented by surging U.S. Treasury yields a run of resilient economic data fuelled fears of higher-for-longer rates in the world's largest economy.
For GRAPHIC on emerging market FX performance in 2023, see http://tmsnrt.rs/2egbfVh For GRAPHIC on MSCI emerging index performance in 2023, see https://tmsnrt.rs/2OusNdX
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For CENTRAL EUROPE market report, see
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For RUSSIAN market report, see (Reporting by Sruthi Shankar in Bengaluru; editing by Barbara Lewis)
