EMERGING MARKETS-Latam FX hit by strong dollar; growing unrest knocks down Chilean, Colombian peso

Medha Singh

Chilean, Colombian peso@

* Chilean peso at new low as violence resurges

* Brazil's real falls for fourth straight day

* Dollar lifted by better-than-expected U.S. data

(Updates prices; adds quote, details) Nov 27 (Reuters) - Most Latin American currencies took a hit on Wednesday, as the dollar firmed on upbeat U.S. economic data, while currencies in Chile and Colombia dropped further on growing anti-government protests in those countries. The Colombian peso declined 0.8%, down for the fourth day, as a week of demonstrations against rumored government economic plans, corruption and police violence rolled on. Colombian stocks shed 1.4% as the unrest in the country dimmed risk appetite. Chile's peso closed at a new low as violence resurged in the South American nation following weeks of protests over inequality and inadequate social services. The Brazilian central bank sold dollars on the spot currency market for the third time in three days as the real continued to weaken, threatening to hit another record low. The currency, which has been battered this month also thanks to a failed oil auction, fell as much as 1.2% to a record low of 4.770 on Tuesday. "What's interesting is that inflation (in Brazil) has in fact remained benign as the real has depreciated (but) that's not likely to last," said Peter Cecchini, global chief market strategist at Cantor Fitzgerald. Meanwhile, stocks in the region were mostly higher, with those in Brazil Bovespa and Mexico posting modest gains and Argentina's Merval up more than 5% due to portfolio recomposition after recent losses. Brazilian equities are expected to outperform their Latin America peers next year, due to record-low interest rates and a pending lineup of market-friendly economic reforms, according to a Reuters poll. Traders also signaled fairly thin volumes in a quiet session ahead of the U.S. Thanksgiving holiday on Thursday.

Key Latin American stock indexes and currencies at 1903 GMT:

Stock indexes daily %Latest changeMSCI Emerging Markets 1052.74 0.47MSCI LatAm 2637.20 0.46Brazil Bovespa 107556.92 0.46Mexico IPC 42998.53 0.34Chile IPSA 4597.15 0.75Argentina MerVal 33860.81 5.442Colombia IGBC 1573.78 -1.43Currencies daily %

change Latest

Brazil real 4.2534 -0.35Mexico peso 19.5460 -0.16Chile peso 819.75 -2.74Colombia peso 3503 -0.83Peru sol 3.384 0.00Argentina peso (interbank) 59.7700 0.33

(Reporting by Medha Singh and Shreyashi Sanyal in Bengaluru Editing by Alistair Bell)