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Latam stocks down 0.9%, FX off 0.7%

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Brazil's fiscal package expected to be finalized this week

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Matt Gaetz withdraws name for U.S. attorney general post

(Updates with mid-session trading)

By Shashwat Chauhan and Pranav Kashyap

Nov 21 (Reuters) - Most Latin American currencies

slipped on Thursday as investors avoided dipping in to risky

assets amid elevated geopolitical tensions between Russia and

Ukraine, with Mexico's peso leading losses in the region.

Ukraine said Russia fired what appeared to be an

intercontinental ballistic missile at the city of Dnipro, in

what would be the first use in war of a weapon designed to

deliver long-distance nuclear strikes.

Western officials, who spoke on condition of anonymity,

later told Reuters their initial analysis showed it was not an

intercontinental ballistic missile, though they left open the

possibility that the conclusion could change.

Investors remained on edge, carefully navigating the

turbulent waters of the Russia-Ukraine conflict. In this climate

of uncertainty, the allure of safe-haven assets like gold

and the U.S. dollar shined.

"Markets are playing it more on the safer side. We're also

going in to a period in the next week in which you're getting

lower and lower liquidity," said Juan Perez, director of trading

at Monex USA.

Mexico's peso fell nearly 1% to 20.446 per dollar,

while Colombia's peso was trading flat at 4,384 in light

volumes, likely helped by elevated crude oil prices.

Late on Wednesday, Mexico's lower house of Congress approved

a measure to abolish most of the autonomous bodies that regulate

some economic sectors and ensure government transparency, a

reform that could worsen tensions with the U.S. and hit credit

ratings.

The measure is among the constitutional reforms presented in

February by former President Andres Manuel Lopez Obrador, and

backed by current President Claudia Sheinbaum, aimed at cutting

public spending by centralizing the state apparatus.

Mexico's election of judges by popular vote could be pushed

back by around three months if the Senate accepts a request by

the electoral authority to postpone it, the electoral body's

head said.

Brazil's real dropped 0.78% in catch-up trade after a

local holiday on Wednesday, leading losses in the region.

The Brazilian government's chief of staff said that the

writing of a highly anticipated fiscal package is expected to be

concluded this week, but President Luiz Inacio Lula da Silva has

yet to decide the details and the date of an announcement.

Most Latin American currencies have declined lately as the

dollar remained resurgent globally on expectations that the

Federal Reserve would slow its pace of monetary easing.

Uncertainty over the impact of U.S. President-elect Donald

Trump's policies on immigration, trade and tariffs has pressured

Latin American assets, particularly close trading partners like

Mexico.

Republican Matt Gaetz withdrew from consideration as Trump's

attorney general, in the face of opposition from the Senate

Republicans whose support he would have needed to win the job.

Peru's sol bucked the trend, ticking 0.2% higher

against the dollar.

MSCI's gauge for Latin American currencies

slipped 0.74%, while the stocks index fell 0.9%.

Regional heavyweight Brazil's benchmark dropped

close to 1% after Wednesday's public holiday, while Mexico's

bourse ticked up 0.1% .

Elsewhere in emerging markets, South Africa's central bank

opted for another small cut to its main interest rate, bringing

the repo rate down to 7.75%, while Turkey's central bank held

its policy rate steady at 50%, as widely expected.

Key Latin American stock indexes and currencies:

Equities Latest Daily % change

MSCI Emerging Markets 1084.84 -0.82

MSCI LatAm 2060.64 -0.94

Brazil Bovespa 127182.24 -0.79

Mexico IPC 50234.44 0.13

Chile IPSA 6593.27 0.26

Argentina MerVal 2133284.01 -0.59

Colombia COLCAP 1389.75 0.25

Currencies Latest Daily % change

Brazil real 5.8178 -0.78

Mexico peso 20.446 -0.94

Chile peso 973.64 -0.09

Colombia peso 4384 0.08

Peru sol 3.79 0.21

Argentina peso (interbank) 1,003.5 -0.05

Argentina peso (parallel) 1,110.0 2.2