EMERGING MARKETS-Latam FX dips, Chile's peso rattled by Chinese metals crackdown

    * Brazil's real flat, inflation spikes
    * New Chinese policy could cap metal prices
    * Fitch doubtful on Mexican economic recovery

 (Recasts with Chile's peso, updates prices)
    By Susan Mathew and Ambar Warrick
    May 25 (Reuters) - Chile's peso led losses across Latin
American currencies on Tuesday after a Chinese crackdown on
metal prices hurt copper, while Mexico's peso dipped on a
warning from Fitch over economic growth in the country. 
    The Chilean peso fell 0.6% to a near one-month low,
tracking a decline in the prices of copper- the country's
largest export. China, a major consumer of industrial metals,
outlined plans to strengthen price controls on key metals, which
could put a cap on prices. 
    Still, global copper demand is expected to surge this year
as more countries emerge from COVID-19 lockdowns. 
    Mexico's peso fell 0.3%, as ratings agency Fitch said
it expects that economic recovery in the country and the
Caribbean from the pandemic will lag peers given the deep
economic contractions and muted recovery prospects there.

     Data on Tuesday showed Mexico swung to a
bigger-than-expected trade surplus in April powered by record
    Still, concerns over an economic recovery from the pandemic
have been a prevalent theme for emerging markets this year, with
several countries risking credit downgrades due to strained
public finances and a damaging second wave of the disease.
    Emerging economies from Peru to Romania are in the firing
line as looming U.S. tapering raises the risk of outflows from
local currency bond markets, hitting a vital funding source for
governments striving to recover from the coronarvirus crisis.
    Brazil's real was flat, even as a more than 7% jump
in inflation for the month to mid-May suggested the central bank
will deliver on its pledge to raise interest rates by another 75
basis points next month to 4.25%.
    "There are also signs of a broader increase in goods
inflation. While this inflation spike should start to unwind in
the next few months, the central bank is likely to remain
hawkish, with another 75bp hike in the Selic rate (to 4.25%)...
in June looking almost certain," said William Jackson, chief EM
economist at Capital Economics.
    Brazil's central bank will do what it takes to get inflation
back to target, bank chief Roberto Campos Neto said on Tuesday,
reiterating the bank's hawkish stance.
    Argentine markets were closed for a holiday.
    Elsewhere, Turkey's lira inched closer to all-time
lows after President Tayyip Erdogan replaced the central bank's
fourth policymaker in the last two months, bringing its autonomy
into question. 
    Key Latin American stock indexes and currencies:
                              Latest     Daily % change
 MSCI Emerging Markets         1345.40              1.41
 MSCI LatAm                    2449.96             -1.27
 Brazil Bovespa              123042.65              -0.8
 Mexico IPC                   49038.80             -0.85
 Chile IPSA                    4101.82             -0.32
 Colombia COLCAP               1210.60             -1.39 Currencies             Latest     Daily % change
 Brazil real                    5.3265             -0.02
 Mexico peso                   19.9006             -0.25
 Chile peso                     733.38             -0.55
 Colombia peso                 3737.25             -0.13
 Peru sol                       3.8208             -0.29

 (Reporting by Susan Mathew in Bengaluru
Editing by Mark Heinrich and Alistair Bell)