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Latam stocks up 0.9%, FX up 0.4%

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Peru interest rate decision awaited

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Mexican peso hits highest level so far this year

(Updates with mid-session trading)

By Shashwat Chauhan and Purvi Agarwal

March 13 (Reuters) - Most Latin American currencies were

mixed on Thursday, as jitters continued around U.S. President

Donald Trump's tariff threats, and investors eyed fresh U.S.

data amid growing concerns around an American economic slowdown.

In the latest twist of the tariff saga, Trump threatened to

slap a 200% tariff on all wines and other alcoholic products

coming out of Europe if the European Union does not scrap its

planned tax on American whiskey.

Trump also said he was not going to change his mind on

imposing sweeping reciprocal tariffs on all trading partners on

April 2, amid intensive talks between the U.S. and Mexico,

according to Mexican Economy Minister Marcelo Ebrard.

The Mexican peso, which has been front and center in

the whiplash of tariff uncertainty recently, was last up 0.4%.

It hit 20.0553 per dollar, its highest level so far this year.

"The Mexican peso is demonstrating remarkable

resilience amid negative signals from its industrial sector and

economic uncertainties in the U.S.," said Quasar Elizundia,

research strategist at Pepperstone.

"Global trade tensions and concerns about a potential

U.S. recession could drive an increase in risk aversion,

negatively impacting the currency in the short term."

Data showed industrial output in the country fell 0.4%

in January from December and was 2.9% lower year-over-year.

Earlier this week, U.S. Commerce Secretary Howard Lutnick

had said nothing would stop Trump's expanded 25% tariffs on

steel and aluminum until U.S. domestic production is

strengthened, and that Trump will add copper to his trade

protections.

However, U.S. producer prices were unexpectedly unchanged in

February, but the cooling trend is unlikely to be sustained as

tariffs on imports are expected to raise prices of goods in the

coming months.

Traders expect about 73 basis points of U.S. rate cuts by

December, with the first cut this year likely in June, according

to LSEG data.

Fears of an American economic slowdown have weighed on

sentiment lately, with S&P Global Ratings researchers saying

that if Trump's trade policies hit U.S. growth, Latin American

economies could suffer because of their strong "trade linkages"

to the United States.

Brazil's real was flat. Data showed services sector

in the economy fell slightly more than expected in January.

Colombia's peso weakened 0.5%, while Chile's peso

appreciated 0.3%.

MSCI's index for Latin American currencies

was up 0.4%, while the stocks gauge advanced

0.9%.

Regional equities were mixed, with heavyweight Brazilian

shares up 1.5%, and Argentina's main stock index

down 1.3%.

Still, the regional equities have broadly fared better than

their U.S. counterparts so far this month, with the MSCI gauge

up more than 1% this month while the S&P 500 briefly

flirted with slipping into a correction.

Later in the day, Peru's central bank is widely anticipated

to hold its interest rate steady at 4.75%.

A trade group report showed foreigners added nearly $16

billion to their EM portfolios in February, with investors

loading up on Chinese stocks and debt across developing

economies.

Key Latin American stock indexes and currencies:

MSCI Emerging Markets 1106.08 -0.45

MSCI LatAm 2021.61 0.91

Brazil Bovespa 125743.32 1.52

Mexico IPC 51916.51 -0.24

Chile IPSA 7451.41 0.81

Argentina Merval 2243511.3 -1.30

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Colombia COLCAP 1591.16 -0.59

Brazil real 5.7997 -0.03

Mexico peso 20.0957 0.38

Chile peso 933.88 0.28

Colombia peso 4122.5 -0.46

Peru sol 3.668 -0.19

Argentina peso (interbank) 1066.25 -0.02

Argentina peso (parallel) 1215 1.23