File picture: Alex Grimm

London - Ukraine's hryvnia fell towards last week's 4-year low versus the dollar and its sovereign bonds tumbled on Thursday as concerns intensified about the economic outlook, while higher US Treasury yields weighed on broad emerging shares.

The Nigerian naira tested a two-year low against the dollar a day after President Goodluck Jonathan sacked four cabinet members in the latest of a wave of government changes before elections next year.

South Africa's rand, the Turkish lira and Hungarian forint also traded weaker.

Concerns have been growing as to how Ukraine could keep supporting its currency and pay off its debt as Russia suspended a $15 billion bailout after President Viktor Yanukovich sacked his prime minister on January 28.

“It is continued fallout from the political crisis,” said Richard Segal, analyst at Jefferies.

That dismissal was seen as a concession to anti-government protesters who have taken to the streets to demonstrate against moves that would bring the former Soviet republic closer into Moscow's economic orbit.

The central bank brought in temporary currency controls last week after the hryvnia fell below 9 per dollar for the first time in five years.

Ukraine's sovereign dollar bond due 2020 hit a two-year low of 83.50 cents while state energy firm Naftogaz' 2014 bond hit its lowest level since October 2011 on Wednesday.

The benchmark emerging equity index slipped, following China's shares which fell for the first time in five days because of weakness in the property sector.

Higher Treasury yields also weighed on general sentiment as investors pull money away from emerging market assets to the recovering US economy.

US Treasury yields rose on Wednesday after the US House of Representatives passed a measure on the debt ceiling and a new Federal Reserve chair vowed to maintain the bank's current strategy of reducing asset purchases at a gradual pace.

Yields on US 30-year bonds climbed to three-week peaks, while those on 10-year notes hit two-week highs.

“At the end of the day, US rates will be tighter and that's not going to be positive for emerging markets. Also it's not easy to have a clear view on what's happening in China,” said Gaelle Blanchard, strategist at Societe Generale in Paris.

The rand fell half a percent to 11.06 per dollar while the lira was a touch softer at 2.19.

Turkey launched a 2045 dollar bond earlier, with the prices up 1.25 point already.

Hungary's forint was down 0.3 percent at 310.32, with focus turning to next week's monetary policy meeting.

Investors are watching inflation data due on Friday for signals that the central bank could cut interest rates further from record lows of 2.85 percent despite market tensions.

The Nigerian naira fell to 165.78 per dollar, bringing its year-to-date losses to more than 3 percent.

Africa's second largest economy and biggest oil producer has been a top frontier market investment destination over the past few years but political instability is a concern ahead of elections.

The central bank announced new rules last week requiring currency dealers to put naira in their accounts at the bank two days before bidding in its forex auctions, but the move did little to stem the naira's decline. - Reuters