(Recasts with Mexican yields) MEXICO CITY, July 6 (Reuters) - Yields on Mexican interest rate swaps rose on Thursday after minutes from the central bank's last meeting suggested it may not be finished hiking interest rates and could copy any further hikes by the U.S. Federal Reserve. After Mexico's central bank raised its benchmark interest rate last month for the seventh consecutive time, to a more than eight-year high, the market has tilted toward bets that it is done hiking. Investors have begun to price in rate cuts as soon as next May, but the minutes did not provide any clear sign that policymakers were thinking about when they could begin to reduce borrowing costs. Meanwhile, Brazil's stocks and currency slipped on lingering concerns over a political crisis, but shares of power utilities rallied due to a planned regulatory overhaul of the sector. Demand for Brazilian assets has fizzled in recent months as traders fear a corruption scandal could delay implementation of President Michel Temer's ambitious agenda, which is seen as critical to fuel long-term economic growth. The Brazilian real dipped about 0.2 percent while other Latin American currencies were mostly flat. The Colombian peso, however, strengthened 0.3 percent, tracking rising crude oil futures. Brazil's benchmark Bovespa stock index fell more than 1 percent, weighed down by blue-chips such as lender Itaú Unibanco Holding SA and beverage producer Ambev SA . Shares of miner Vale SA also fell on lower iron ore prices. The index's losses were limited by a rally in shares of power utilities after the government announced that plans to overhaul power sector rules could lead to higher rates and lower taxes. Shares of state-controlled utility Centrais Elétricas Brasileiras SA, or Eletrobras, which would benefit directly from the revamp, soared nearly 10 percent.
Key Latin American stock indexes and currencies at 1920 GMT:
Stock indexes Latest Daily YTD pct pct
MSCI Emerging Markets 1,006.38 -0.34 17.12 MSCI LatAm 2,536.65 -0.4 8.81 Brazil Bovespa 62,462.48 -1.1 3.71 Mexico IPC 50,020.86 -0.56 9.59 Chile IPSA 4,826.64 -0.45 16.27 Chile IGPA 24,148.25 -0.38 16.47 Argentina MerVal 22,272.37 -0.72 31.65 Colombia IGBC 11,031.74 0.13 8.92 Venezuela IBC 123,749.70 0.08 290.31 Currencies Latest Daily YTD pct pct
Brazil real 3.2980 -0.18 -1.48 Mexico peso 18.2900 0.07 13.42 Chile peso 665.5 0.03 0.78 Colombia peso 3,095.25 -0.40 -3.03 Peru sol 3.253 0.12 4.95 Argentina peso (interbank) 17.0700 0.47 -7.00 Argentina peso (parallel) 17.2 0.06 -2.21
(Reporting by Michael O'Boytle in Mexico City and Bruno Federowski in Sao Paulo; Editing by Lisa Von Ahn and Dan Grebler)