EMERGING MARKETS-LatAm currencies mostly weaken as U.S. tax plan advances

BRASILIA, Dec 20 (Reuters) - Most Latin American currencies weakened on Wednesday after a plan to overhaul the U.S. tax code advanced in Congress, fueling expectations of faster interest rate hikes in coming months. The Republican-led U.S. Senate approved sweeping tax legislation in the pre-dawn hours Wednesday, sending the package back to the House of Representatives for a final vote later in the day. Tax cuts could lift U.S. inflation and force the Federal Reserve to tighten policy at a faster-than-expected pace, driving capital away from high-yielding assets. Still, doubts over the bill's efficacy in boosting U.S. growth kept a lid on the U.S. dollar's gains. "I expect there'll be pressure on the U.S. fiscal accounts without a substantial improvement to economic growth," Wagner Investimentos director José Faria Junior said. Currencies from Mexico, Chile and Colombia slipped between 0.1 percent and 0.3 percent, while the Brazilian real firmed 0.1 percent. The Brazilian real firmed 0.1 percent, while the benchmark Bovespa stock index rose 0.8 percent. Shares of Brazilian banks, such as Itaú Unibanco Holding SA and Banco Bradesco SA led gains after the central bank lowered reserve requirements, injecting 6.5 billion reais ($1.97 billion) in the economy.

Key Latin American stock indexes and currencies at 1720 GMT:

Stock indexes daily % YTD % change change


MSCI Emerging Markets 1133.09 0.08 31.3 MSCI LatAm 2768.07 0.6 17.55 Brazil Bovespa 73248.12 0.78 21.62 Mexico S&P/BVM IPC 48486.18 0.17 6.23 Chile IPSA 5583.87 -0.08 34.51 Chile IGPA 28014.72 -0.08 35.11 Argentina MerVal 27892.08 0.67 64.87 Colombia IGBC 11099.53 -0.04 9.59 Venezuela IBC 1290.63 0 -95.93 Currencies daily % YTD % change change


Brazil real 3.2935 0.07 -1.35 Mexico peso 19.2720 -0.38 7.64 Chile peso 620.7 -0.11 8.06 Colombia peso 2975.26 -0.30 0.88 Peru sol 3.284 -0.09 3.96 Argentina peso (interbank) 17.8400 -0.50 -11.01 Argentina peso (parallel) 18.11 0.77 -7.12

(Reporting by Bruno Federowski; Editing by David Gregorio)