*

Brazil stresses need for coordination between monetary,

fiscal

policies

*

Brazil's jobless rate drops to 6.6% in quarter through

August

*

Argentina poverty rate soars over 50% as Milei austerity

bites

*

Ghana slashes key rate as inflation outlook improves

*

Latam FX down 0.2%, stocks down 0.5%

(Updated at 3:18 p.m. ET/1918 GMT)

By Ankika Biswas

Sept 27 (Reuters) - Most Latin American currencies were

set for weekly gains on Friday, with Chile's peso outperforming

as metal prices firmed on the back of improving China demand

prospects after Beijing unveiled a raft of stimulus measures

this week.

A key Latin American currencies index on Friday was on track

for its first fourth straight weekly gain since June 2023, with

Chile's peso at the forefront following rallying metal prices on

hopes of improving China demand.

Top copper producer Chile's peso has strengthened

more than 3% against the dollar this week, as prices of the red

metal were set for their best weekly gain in more than four

months.

No. 2 copper producer Peru's sol also rose nearly 1%

for the week.

The MSCI index tracking Latam currencies has

jumped more than 3% in its four weeks of advance, as economic

stimulus measures in top metals consumer China improved the

demand outlook for metals and sent their prices sharply higher.

Most emerging market stocks and currencies have been riding

on optimism around a Federal Reserve interest rate cut, which

was met by a larger-than-usual 50-basis-point reduction last

week that further deepened investors' risk appetite. The MSCI EM

stocks index logged its best weekly performance in

nearly four years.

Among others, Brazil's real also climbed 1.3% against the

dollar on a weekly basis, as iron ore future prices logged an

over 10% weekly gain.

However, the currency was largely flat on the day, with data

showing the country's jobless rate in the three months through

August dropped to at least a 13-year low, reinforcing labor

market strength.

"While the labor market remains resilient, we believe this

trend is unsustainable and expect a gradual deterioration over

the next three to six months," said Andrés Abadía, chief Latam

economist at Pantheon Macroeconomics.

"Domestic policy uncertainty and challenging external

conditions are adversely affecting key sectors and likely

constraining job-market expansion."

Further, Brazil's central bank chief Roberto Campos Neto

said tighter interest rates alongside looser fiscal policy

create inefficiencies that hinder the transmission of monetary

policy, leading to a prolonged period of higher borrowing costs.

Meanwhile, ratings agency Fitch said Brazil's

better-than-expected economy has not translated into stronger

public finances, forecasting a tougher 2025 and a steeper rise

in the country's public debt.

Colombia's peso edged 0.2% lower, ahead of the

country's monetary policy decision on Monday, with analysts

split on the likelihood of a 50- or 75-bps rate cut.

However, the currency, along with Mexico's peso were

on track for weekly declines as oil prices were set for a weekly

fall.

Among the other key events over the week's course was a

25-bps cut by the Bank of Mexico, its second straight reduction

amid easing inflation.

Elsewhere, Ghana slashed its main interest rate by 200 basis

points to 27%, its first rate cut since January.

HIGHLIGHTS:

** Brazil tops expectations with 232,513 formal jobs created

in August

** Pakistan inflation to slow down in the range of 8%-9% in

near term - government report

** Zambia targets smaller budget deficit in 2025- finance

minister

Key Latin American stock indexes and currencies:

MSCI Emerging Markets 1175.94 1.08

MSCI LatAm 2257.31 -0.53

Brazil Bovespa 132780.96 -0.17

Mexico IPC 52896.67 -1.29

Chile IPSA 6530.08 0

Argentina Merval 1728883.3 0.77

9

Colombia COLCAP 1320.36 -0.85

Brazil real 5.4368 0.01

Mexico peso 19.7308 -0.61

Chile peso 899.65 0.13

Colombia peso 4177.48 -0.22

Peru sol 3.702 0.21

Argentina peso (interbank) 966 0.155279503

Argentina peso (parallel) 1225 0.408163265