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EMERGING MARKETS-Mexican peso, stocks climb after upbeat data

    * Chilean peso hits new 14-month high
    * Mexico to start vaccination on Thursday 
    * Dollar weakens, supporting EM currencies
    * Argentine's clack market peso drops

 (Adds context, details; updates prices)
    By Medha Singh
    Dec 23 (Reuters) - Mexico's peso and stocks gained on
Wednesday as rising oil prices and an improving economic outlook
outweighed fears about a highly infectious variant of the
coronavirus that have dominated trading this week.
    The peso and the IPC equities index were set
to snap a three-day losing streak as prices of oil - Mexico's
top export - jumped about 2%, supported by a weaker dollar.

    Latest data showed Mexico's economy grew slightly faster
than expected in October, while inflation was a shade below
forecast in early December, easing to its lowest rate in six
months.
    "The recovery of services in October is both noteworthy and
surprising," Citi's Adrian de la Garza said as he adjusted the
projection for Mexico's 2020 economic contraction to 8.6% from
8.9%.
    "We think that November will be a mixed bag and December may
see a slight contraction in light of the renewed restrictions...
- most notably in Mexico City and Mexico State, which jointly
account for about one-quarter of national GDP."
    Mexican President Andres Manuel Lopez Obrador said COVID-19
vaccinations will begin in Mexico on Thursday and that he
expects the economy to have recovered almost to its pre-pandemic
levels by the end of the first quarter of 2021.

    Investors are counting on a weakening dollar - on track for
its weakest year since 2017 - to boost rallies in everything
from U.S. stocks to emerging markets and industrial metals in
2021.
    The currency of the world's largest copper producer Chile
 hit a fresh 14-month high after prices of the metal 
pushed back towards their multi-year highs.        
    Argentina's black market peso depreciated to 155/159
per dollar in thin trading volumes, widening the gap between the
informal rate and the official, controlled peso exchange rate
 to 90.7%.
    Brazil's real also weakened to levels last seen in
early December. Markets in Brazil and Argentina will be closed
on Thursday and Friday for the Christmas holidays.
    An imminent U.S. stimulus package, optimism over a Brexit
trade deal and a fall in U.S. jobless claims spurred appetite
for riskier bets on Wednesday, along with hopes that COVID-19
vaccines will be effective against the new virus variant.

    The broader Latin American stocks index rose
0.6%, tracking gains in global stocks.
    Shares in Brazil's state-controlled oil company Petroleo
Brasileiro SA jumped 2.9% after it started the
process of selling its 51% stake in the Brazil-Bolivia gas
pipeline as part of a divestment programme.
    
    Key Latin American stock indexes and currencies:
    
    
 Stock indexes                                  daily % change
                                    Latest     
 MSCI Emerging Markets                1258.34             0.77
 MSCI LatAm                           2425.22             0.55
 Brazil Bovespa                     117992.79             1.16
 Mexico IPC                          43544.49             2.21
 Chile IPSA                           4156.29            -0.81
 Argentina MerVal                    51420.93            2.012
 Colombia COLCAP                      1415.86             1.07 Currencies                                     daily % change
                                               
                                       Latest  
 Brazil real                           5.2005            -0.76
 Mexico peso                          20.0767             0.27
 Chile peso                             713.7             1.22
 Colombia peso                        3498.45            -1.02
 Peru sol                               3.607             0.13
 Argentina peso (interbank)           83.3500            -0.12
                                               
 Argentina peso (parallel)                154            -1.30
                                               
 
 (Reporting by Medha Singh and Shashank Nayar in Bengaluru;
Editing by Nick Macfie)
  
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