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Latam stocks up 0.1%, though set for weekly loss

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Chile's peso jumps after local rate decision

By Shashwat Chauhan

May 24 (Reuters) - Most Latin American currencies were

set for weekly losses on Friday as crumbling expectations for

Federal Reserve interest rate cuts propped up the dollar, while

Chile's peso outpaced peers following a smaller local interest

rate cut.

Chile's peso jumped 1.3% following sharp losses in

the last two sessions after its central bank cut its benchmark

interest rate by 50 basis points to 6.00% in a unanimous

decision, saying that it foresees further cuts to the rate but

promising to be flexible.

The decision, in line with forecasts in a traders' poll last

week, reflects an easing in the size of rate cuts after a

75-basis point cut in April and a 100-basis point cut in

January.

"The magnitude of the cut was in line with consensus

expectations, and the presser retained a strictly data-dependent

tone," Barclays strategists said in a note.

"This should support the CLP in the short term if copper

stays firm."

Brazil's real slipped 0.2% against the dollar, on

track for a weekly fall of close to 1%, while Mexico's peso

was flat at 16.72 per dollar, set for its first weekly

fall in four.

Colombia's peso and Peru's sol shed 0.3% each.

Global risk sentiment soured this week on the prospects of

U.S. rates remaining elevated for longer following resilient

U.S. economic data and hawkish minutes from the Fed's last

policy meeting.

Most equities in the region rose tracking an upbeat start on

Wall Street, with MSCI's index for Latin American stocks

up 0.1%, though set for a near 3% drop this

week.

Brazil's Bovespa rose 0.3%, boosted by real estate

and utilities shares.

Brazilian airline Azul jumped around 8% after

announcing a codeshare agreement with Gol. Gol shares

were up close to 14%.

Equities in Chile, Colombia and

Argentina gained between 0.1% and 0.5%.

On the data front, Brazil posted a wider-than-expected

current account deficit of $2.5 billion in April, and Mexico

posted a trade deficit of $2.58 billion.

HIGHLIGHTS

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** Ghana receives debt restructuring memorandum from

official creditors

** Brazil's Petrobras approves Chambriard as new CEO

Key Latin American stock indexes and currencies:

Latest Daily % change

MSCI Emerging Markets 1084.16 -0.66

MSCI LatAm 2418.08 -0.08

Brazil Bovespa 125068.08 0.27

Mexico IPC 55660.27 -0.46

Chile IPSA 6789.46 0.11

Argentina MerVal 1521038.68 0.48

Colombia COLCAP 1409.05 0.19

Currencies Latest Daily % change

Brazil real 5.1520 0.01

Mexico peso 16.7218 -0.04

Chile peso 899.5 1.30

Colombia peso 3879.98 -0.26

Peru sol 3.7328 -0.23

Argentina peso 890.5000 0.00

(interbank)

Argentina peso 1245 2.81

(parallel)