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Brazil to hike rates by 25 basis points on Sept 18- Poll

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Colombia govt will not change proposed 2025 budget value

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U.S. Fed cuts rates by 50-basis-points

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Argentina's economy shrank 1.7% in Q2

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Latam FX up 0.8%, stocks up 0.6%

(Updated at 3:30 p.m. ET/ 1930 GMT)

By Ankika Biswas and Shashwat Chauhan

Sept 18 (Reuters) - Latin American currencies were mixed

on Wednesday, with the Brazilian real jumping ahead of a likely

local rate hike, while global markets continued to assess the

implications of the U.S. Federal Reserve opting for a interest

large rate cut.

The dollar weakened globally after the Fed cut interest

rates by half of a percentage point, kicking off what is

expected to be a steady easing of monetary policy with a

larger-than-usual reduction in borrowing costs that followed

growing unease about the health of the job market.

"Against a backdrop where the strength of the economy has

been difficult to gauge, the move to cut 50 basis points out of

the gate from the Fed seems to be appropriate as the pace of

rate cuts on the path to neutral can be adjusted accordingly,"

said Charlie Ripley, senior investment strategist at Allianz

Investment Management.

Although Latam countries began easing rates long before the

Fed, lower U.S. rates could give EM central banks more scope to

ease further to support domestic growth.

Moving in the opposite direction to its peers, however,

Brazil is expected to increase its rates by 25 basis points

later in the day, marking the start of a short tightening

campaign to quash persistent inflationary trends.

The Brazilian real rose for the fifth straight

session to strengthen 0.7% against the dollar, the highest in

nearly a month.

The MSCI index for Latam currencies rose

0.8% to its highest level since Aug. 20, with Peru's sol

rising 0.3% to a three-week high and the Colombian peso

advancing 1.1%.

Colombia's Finance Minister Ricardo Bonilla said in an

interview on Tuesday that its government will not modify the

value of $123.9 billion for its proposed 2025 budget.

Meanwhile, the Mexican peso dropped 0.8%, emerging as

the worst-hit Latam currency on the day.

Data showed Mexican private spending fell 0.6% during the

second quarter compared to the previous three-month period.

The MSCI Latam stocks index rose 0.6% to a

three-week high, even though most of the major regional stock

bourses were trading lower.

Argentina's economy shrank 1.7% in the second quarter

compared to the previous three months, the country's statistics

agency said, extending a recession the South American nation

entered early this year.

Elsewhere, Cuba's booming private businesses braced as the

island's communist-run government implemented laws aimed at more

tightly regulating the private sector amid a deepening economic

crisis.

Markets in Chile were shut for a public holiday.

Key Latin American stock indexes and currencies:

MSCI Emerging Markets 1089.83 -0.06

MSCI LatAm 2278.83 0.58

Brazil Bovespa 134296.43 -0.49

Mexico IPC 52653.72 0.73

Chile IPSA 6323.95 -0.36

Argentina Merval 1807193.8 -0.337

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Colombia COLCAP 1307.56 -0.44

Brazil real 5.4442 0.7

Mexico peso 19.236 -0.75

Chile peso 931.55 -0.22

Colombia peso 4160.61 1.08

Peru sol 3.7372 0.34

Argentina peso (interbank) 962 -0.051975052

Argentina peso (parallel) 1240 2.419354839