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Rate decisions in Chile, Mexico and Colombia this week

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U.S. Fed rate decision on Wednesday

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Both Latam FX and stocks down 0.3% each

(Updates with afternoon trading)

By Pranav Kashyap and Shashwat Chauhan

Dec 17 (Reuters) - The Brazilian real reversed course

after hitting all-time lows on Tuesday, while most Latin

American currencies were mixed ahead of a plethora of interest

rate decisions this week including the U.S. Federal Reserve.

The real reversed course in choppy trading to rise

0.8% after falling to all-time lows of 6.15 per dollar earlier

in the session.

The country's central bank held spot U.S. dollar auctions

for the third consecutive session, amid market concerns over

government spending beating down the real.

Minutes from Brazil's central bank last policy meeting

showed that the body reaffirmed its tough monetary policy

stance, with policymakers highlighting unanimous concern over

higher inflation expectations and a weakening currency.

"The (central bank) was quite vocal in acknowledging the

negative market reaction to the recently announced fiscal

package (higher risk premia, BRL depreciation, and deterioration

of inflation expectations)," Goldman Sachs analysts noted.

The real's performance has been among the worst in the

region, plummeting more than 26% since the start of the year,

primarily due to market disappointment over anticipated spending

cuts that did not meet expectations.

Mexico's peso fell 0.4% amid a global strengthening

of the dollar. Separately, data showed a 0.3% decline in retail

sales for October.

All eyes are now on the central Banco de Mexico, which is

set to meet on Thursday. Analysts predict a fifth and final

quarter-percentage point rate cut for the year.

Chile's peso turned higher, last up 0.3% as the

nation awaited its central bank's rate decision. A 25 basis

point reduction to 5% is anticipated.

Colombia's peso lost 0.6%, with expectations set for

a 50 basis point rate cut from its central bank on Friday.

Global markets were on edge heading into the Fed's rate

decision on Wednesday where it expected to cut rates by 25 basis

points. However, the Fed's policy outlook for the coming year is

expected to steer market dynamics.

"It is almost certain that the Fed's communications -

especially its (Summary of Economic Projections) - will look and

sound more hawkish than in September or November," Thierry

Wizman, global FX & rates strategist at Macquarie.

The U.S. dollar index nudged up 0.1%, buoyed by

better-than-expected retail sales data for November. A stronger

dollar and higher U.S. rates could pose challenges for emerging

market assets.

MSCI's index for Latin American currencies

recouped some losses and was now down 0.3%, while the stocks

index also shed 0.3%.

Brazilian healthcare operator Hapvida slid more

than 12% after the country's healthcare regulator ANS unveiled

preliminary studies on Monday regarding changes to health plan

pricing.

Argentina's benchmark continued its charge upwards,

rising 1.6%. Data showed Argentina posted a primary fiscal

surplus in November at 1.382 trillion Argentine pesos ($1.37

bln), the eleventh consecutive monthly surplus.

Key Latin American stock indexes and currencies:

MSCI Emerging Markets 1093.87 -0.85

MSCI LatAm 1957.8 -0.27

Brazil Bovespa 124480.05 0.74

Mexico IPC 50484.52 -0.72

Chile IPSA 6730.22 -1.01

Argentina Merval 2585034.9 1.645

9

Colombia COLCAP 1371.33 0.05

Brazil real 6.0997 0.78

Mexico peso 20.208 -0.42

Chile peso 986.56 0.28

Colombia peso 4345.45 -0.56

Peru sol 3.7306 0.14

Argentina peso 1020 0.20

(interbank)

Argentina peso (parallel) 1145 -1.75