EMERGING MARKETS-Asian assets under pressure as rate fears deepen bond sell-off

* Equities, currencies decline across the board * Thai baht, Indonesian rupiah among top losers * Shares in Indonesia, Singapore decline over 1% * Taiwan dollar hits 7-year low By John Biju Oct 4 (Reuters) - A sell-off in risk-sensitive Asian emerging markets deepened on Wednesday as Treasury yields surged on worries that the U.S. Federal Reserve will hold interest rates higher for longer, triggering a rout in regional currencies, bonds, and equities. The Thai baht and the Indonesian rupiah were among the worst affected currencies in the region, while shares in Singapore, Indonesian, and Seoul declined between 1% and 2.3%. A surge in U.S. Treasury yields - the 10-year yields are currently trading at a 16-year-high of 4.8503% - has pressured emerging market bonds, with Indonesia's 10-year yields scaling a fresh 10-month peak to 7.067%. "The combination of high yields and strong USD is driving U.S. equity markets lower while placing considerable pressure on emerging market assets," analyst at DBS said in a note, adding that they expect volatility to be elevated. The Indonesian rupiah, which dipped into negative territory for the first time this year on Tuesday, depreciated 0.3% in its third straight day of declines. Meanwhile, Bank Indonesia said it could maintain price stability with past rate hikes, signalling policy rates will be held steady later this month as it tries to shore up confidence in currency and bond markets. On Tuesday, the central bank intervened in the foreign exchange market to manage the supply and demand of U.S. dollars, and on Wednesday it bought government bonds to improve confidence in the market. "We stay bullish on the pair (dollar-rupiah) as global fundamental conditions of U.S. economic outperformance and firm Fed hawkishness looks to keep supporting both the momentum for higher yields and a stronger greenback," analysts at Maybank said in a note. The Thai baht extended losses into a third session, weakening up to 0.4% and hovering near an 11-month low of 37.220 per dollar, while the ringgit declined 0.2% to 4.733 per dollar, its lowest since early November. Bank of Thailand's governor said that the country's economic recovery was intact but inflation risks could weigh on the growth outlook. Singapore's dollar also weakened 0.2% to 1.3748 per dollar, while shares lost up to 1.5% to touch their lowest in over six weeks. Investors expect the Monetary Authority of Singapore to leave its policy unchanged next week as the city-state fights a weak economic outlook and persistent price pressures. Elsewhere, the South Korean won was largely unchanged while equities were at their lowest since late March. Data showed the country's factory output unexpectedly jumped in August by the fastest rate in more than three years. The Taiwanese dollar retreated 0.3% to hit its lowest level since June 2016, while equities slumped slumped 1.1%. Markets in China were closed for a public holiday. HIGHLIGHTS: ** India's 10-year benchmark yields tick higher to 7.246%, highest since mid-August ** Japan warns it will take 'appropriate' steps on excessive yen falls Asia stock indexes and currencies at 0341 GMT COUNTRY FX RIC FX FX INDE STOCK STOCK DAILY YTD % X S S YTD % DAILY % % Japan -0.15 -12.1 <.N2 -2.18 17.10 5 25> China EC> India -0.02 -0.61 <.NS 0.00 7.86 EI> Indones -0.32 -0.38 <.JK -1.26 0.04 ia SE> Malaysi -0.21 -7.02 <.KL -0.28 -5.32 a SE> Philipp -0.12 -1.90 <.PS -0.42 -4.37 ines I> S.Korea -0.03 -7.38 <.KS -2.23 7.76 11> Singapo -0.15 -2.55 <.ST -1.23 -3.02 re I> Taiwan -0.31 -5.31 <.TW -1.22 14.97 II> Thailan -0.27 -6.98 <.SE -0.10 -13.3 d TI> 5 (Reporting by John Biju in Bengaluru; Editing by Kim Coghill)