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EMERGING MARKETS-Brazil currency weaker as Temer falls under police suspicion

SAO PAULO, Sept 12 (Reuters) - The Brazilian real weakened on Tuesday after police said they suspected President Michel Temer, alongside a group of close aides from his party, participated in illegal acts. In a report on Monday, police said there were indications that Temer and the so-called "Gang of the Lower House" might have engaged in active and passive corruption acts, fraud and other crimes. The report could provide additional evidence for a second formal corruption accusation against Temer in as many months. That could force Temer to spend political capital to convince lawmakers to drop the charges, as they did two months ago, instead of garnering support for market-friendly reforms. The Brazilian real weakened 0.5 percent, backing further away from a six-month peak touched earlier this week. The country's benchmark Bovespa stock exchange, however, rose 1.2 percent to a new all-time high after setting a record the day before. Shares of state-owned power utility Centrais Elétricas Brasileiras SA led the gains, hitting the highest levels since December after the government said it will release a privatization model for the firm this month. Cia Energética de Minas Gerais SA, Brazil's No. 3 power utility, also contributed to the gains. Cemig, as the company is known, could join with miner Vale SA to bid for a number of hydropower dams in an upcoming auction, Vale told Reuters. Other Latin American markets seesawed, with the Mexican peso slipping 0.4 percent and the Colombian peso rising 0.3 percent. The Chilean peso closed flat, as traders booked profits on the currency's recent rally despite rising prices of copper.

Key Latin American stock indexes and currencies at 1725 GMT:

Stock indexes Latest Daily YTD pct pct change

change

MSCI Emerging Markets 1,102.51 0.3 27.48 MSCI LatAm 2,984.55 -0.03 27.55 Brazil Bovespa 75,221.44 1.21 24.90 Mexico S&P/BVM IPC 50,600.71 0.48 10.86 Chile IPSA 5,168.71 0.32 24.51 Chile IGPA 25,830.36 0.27 24.58 Argentina MerVal 23,747.48 -1.33 40.37 Colombia IGBC 11,208.32 -0.41 10.67 Venezuela IBC 303,209.69 8.54 856.34 Currencies Latest Daily YTD pct pct change

change

Brazil real 3.1214 -0.59 4.09 Mexico peso 17.7450 -0.39 16.90 Chile peso 622 0.07 7.83 Colombia peso 2,912.95 0.32 3.04 Peru sol 3.233 -0.06 5.60 Argentina peso (interbank) 17.0800 0.35 -7.06 Argentina peso (parallel) 17.83 0.62 -5.66

(Reporting by Bruno Federowski; Editing by Andrea Ricci)