*

Mexico's annual inflation accelerates slightly in early

October

*

Brazil inflation picks up in mid-October

*

Traders: Argentina risk falls to 2020 debt rework levels

*

Brazil's central bank kicked off monetary tightening cycle

in

September

(Updated at 1944 GMT)

By Shashwat Chauhan and Johann M Cherian

Oct 24 (Reuters) - Most Latin American currencies traded

close to the unchanged mark on Thursday, as investors assessed

inflation reports out of Brazil and Mexico and braced for the

outcome of crucial U.S. presidential elections.

Brazil's real inched up 0.3% to the dollar. Data

showed inflation accelerated in the month to mid-October, as

higher electricity costs pushed consumer prices up.

Markets are pricing in that Copom will lift borrowing costs

by at least 50 basis points in November ahead of the U.S.

Federal Reserve announcing its own decision and as global

markets brace for the outcome of a tight U.S. presidential

election on Nov. 5.

Prediction markets favor former U.S. president Donald

Trump whose tariffs are expected to be a negative for trading

partners like Brazil and Mexico. Along with U.S. election

uncertainty, worries about

fiscal dominance

in Brazil have weighed on the real - the top loser in the

region.

Mexico's peso dipped 0.1% after rising for the last

two sessions. Official data showed Mexico's annual inflation

accelerated slightly in the first half of October.

"On the face of it, October's mid-month inflation figure...

pave the way for another 25 bps at Banxico's next meeting," said

Kimberley Sperrfechter, emerging markets economist at Capital

Economics.

"But the outcome of the U.S. election may well change

the outlook for monetary policy in Mexico, especially if a Trump

victory leads to a sharp sell-off in the peso."

Copper producer Chile's peso dipped 0.1%, while

Peru's sol was flat. Prices of the red metal were

marginally lower.

The Colombian peso firmed 0.6% after sliding to

one-year lows in the previous session.

Latin American currencies have been under pressure as the

dollar gained ground as investors scale back expectations of

large U.S. rate cuts, with a recent rise in Treasury yields

reflecting that sentiment.

MSCI's index for Latin American currencies

was up 0.8%, while a gauge for stocks added 1%.

Most local bourses advanced, with Brazil's Bovespa,

Colombia's Colcap and Chile's main stock index

up between 0.5% and 0.7%.

Mexico's main stock index lost 0.8%, with Becle

down 2% after the world's largest tequila maker said

it

sees lower net sales

and capex this year than it forecast earlier.

Argentina's Merval index jumped 3.3% after three

previous sessions in the red.

The World Bank and the Inter-American Development Bank (IDB)

are providing Argentina with $8.8 billion in financing, as the

cash-strapped government ramps up support from key lenders.

Yields on hard-currency Argentine bonds expiring in 2029

and 2030

fell over 100 bps. Traders said the country's risk fell

to its

lowest level

since major debt restructuring in 2020.

Key Latin American stock indexes and currencies:

Latin American market prices from Reuters

MSCI Emerging Markets 1135.01 -0.6

MSCI LatAm 2174.64 1.00

Brazil Bovespa 129851.77 0.48

Mexico IPC 51728.7 -0.79

Chile IPSA 6725.8 0.58

Argentina Merval 1834213.6 3.376

9

Colombia COLCAP 1331.28 0.74

Brazil real 5.6701 0.32

Mexico peso 19.8468 -0.1

Chile peso 946.2 -0.11

Colombia peso 4294.71 0.63

Peru sol 3.752 0.03

Argentina peso (interbank) 985 0.00

Argentina peso (parallel) 1195 2.93