*

Mexico's inflation undershoots forecasts ahead of rate

decision

*

Uncertainties prevent indication of future tightening

steps-

Brazil c.bank

*

Copper, iron ore, oil prices jump on China's stimulus

measures

*

Latam FX up 1%, stocks up 2.5%

By Ankika Biswas

Sept 24 (Reuters) - Stocks and currencies of

resource-rich Latin American countries jumped on Tuesday,

boosted by sharp gains in commodity prices on a strong demand

outlook following China's wide-ranging stimulus measures, with

Brazil's real and Chile's peso in the lead.

The MSCI index for Latam currencies climbed

1%, while the stocks index advanced 2.5%, on

track for its biggest one-day gain in more than a month.

The gains in Latam assets were in line with their broader

emerging market peers, with the MSCI EM stocks index

jumping 2% and hitting a two-year high.

With copper prices hitting 10-week highs on the back of top

metals consumer China's stimulus measures, the largest copper

producer Chile's peso strengthened 1.3% against the

dollar to hit a near one-month high.

Prices of iron ore futures also logged their largest

intraday gain in over a year, likely aiding the 1.4% rise in

Brazil's real. Miner Vale, one of the world's

largest iron ore miners, jumped 5%, among the top gainers on

Brazil's main stock index

Brazil's central bank said it gave no indication of its next

steps regarding the pace and magnitude of a tightening cycle due

to uncertainties, instead insisting on its "firm commitment" to

bringing inflation to the target.

The central bank's chief Roberto Campos Neto also noted

market concerns over the country's fiscal outlook have affected

long-term rates, but played them down as exaggerated.

An around 2% jump in oil prices also lifted the Mexican peso

and Colombian peso by 0.4% and 0.7%, respectively.

The Mexican benchmark stock index also gained over 1% to

hit a near one-month high.

Data showed Mexico's annual inflation slowed more than

expected in the first half of September, paving the way for

another interest rate cut. The country's policy decision is due

on Thursday.

"We expect factors such as slowing domestic demand, lower

oil prices, persistently high real interest rates and moderating

labor-market pressures to keep inflation in check," said Andrés

Abadía, chief Latam economist at Pantheon Macroeconomics.

"But risks remain skewed to the upside, particularly due to

the delayed impact of MXN depreciation and greater policy

uncertainty, which could negatively affect Mexico's financial

metrics."

Meanwhile, a Reuters poll showed analysts are split on how

Colombia might cut its benchmark interest rate in its vote next

week. A majority of the analysts forecast a 50-basis-point cut,

while the rest anticipate a 75-bps reduction.

Elsewhere, Hungary cut its base rate by another 25 basis

points to 6.5%, aided by a fall in inflation and last week's

larger-than-usual cut by the Federal Reserve.

HIGHLIGHTS:

** Russia to increase budget spending in 2025 to $446.24

bln, Russia's Mishustin says

** Nigeria surprises with a rate hike to 27.25%

Key Latin American stock indexes and currencies at 1410 GMT:

Equities Latest Daily % change

MSCI Emerging Markets 1131.98 1.92

MSCI LatAm 2271.08 2.52

Brazil Bovespa 132888.92 1.78

Mexico IPC 53188.65 1.46

Chile IPSA 6446.66 1.13

Argentina Merval 1790228.16 NULL

Colombia COLCAP 1326.68 0.34

Currencies Latest Daily % change

Brazil real 5.4596 1.39

Mexico peso 19.3397 0.39

Chile peso 909.2 1.32

Colombia peso 4128.12 0.71

Peru sol 3.7623 0.03

Argentina peso (interbank) 966 -0.051759834

Argentina peso (parallel) 1225 1.632653061