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Argentina stocks rally

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Latam stocks index down 0.1%

(Updated at 3:05 p.m. ET/ 1905 GMT)

By Shashwat Chauhan and Sruthi Shankar

May 27 (Reuters) - Latin American currencies were mixed

in holiday-thinned trading on Monday as investors awaited

inflation readings from around the world including the United

States and Brazil this week for indications on the path of

global monetary policy.

Brazil's real slipped 0.1% and the Mexican peso

gained 0.1%, albeit in thin trading due to public

holidays in the United States and the UK.

Investors are keenly awaiting data on the U.S. personal

consumption expenditures price index, the Federal Reserve's

preferred measure of inflation, on Friday for clues on whether

the U.S. central bank will be able to cut interest rates this

year.

Locally, Brazilian consumer prices data on Tuesday could

throw light on the size of further rate cuts after the central

bank earlier this month cut interest rates by a smaller 25 basis

points.

"It is expected that the indicator reinforces the

interpretation that inflation in Brazil continues to moderate

gradually and does not pressure the Monetary Policy Committee to

act more strictly," StoneX analysts said in a note.

"The prospect of reductions in the basic interest rate

(SELIC), in turn, reduces the expectation for the country's

interest rate differential and can contribute to weakening the

Brazilian real."

Brazil's central bank chief Roberto Campos Neto said that

policymakers believe inflation expectations should stabilize and

improve over time, after recently citing concerns about them

deviating from the official target.

Chile's peso continued its recent strong run to

rise 0.2% against the dollar, while Peru's sol dipped

0.4%.

Stock markets in the region were also subdued, with MSCI's

index for Latin American stocks down 0.1%.

Gol

dipped 5% after the Brazilian airline said it

expects its exit of Chapter 11 bankruptcy proceedings to involve

a $1.5 billion capital injection through the issuance of new

shares and refinancing of $2 billion in debt.

Argentina's main stock index jumped 2.9%, hovering

near its all-time high hit last week, while shares in Chile

, Colombia and Peru were up

between 0.5% and 0.7%.

Meanwhile, Mexico and Argentina started on Monday to settle

securities trades faster, halving settlement time to one day, in

a move designed to reduce counterparty risk and improve market

liquidity.

Key Latin American stock indexes and currencies:

Latest Daily % change

MSCI Emerging Markets 1090.43 0.69

MSCI LatAm 2407.49 -0.05

Brazil Bovespa 124311.24 0

Mexico IPC 55296.10 -0.21

Chile IPSA 6822.82 0.68

Argentina MerVal 1563486.78 2.806

Colombia COLCAP 1415.37 0.54

Currencies Latest Daily % change

Brazil real 5.1723 -0.09

Mexico peso 16.6565 0.15

Chile peso 900.5 0.38

Colombia peso 3869.9 0.06

Peru sol 3.739 -0.27

Argentina peso 893.0000 -0.22

(interbank)

Argentina peso 1185 2.95

(parallel)