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EMERGING MARKETS-Inflation data supports Mexican peso after 4-day losing run

    * Mexico's inflation climbs to 2-yr high
    * Brazil sees record COVID-19 deaths
    * Carrefour Brasil soars after BIG deal 

    By Sruthi Shankar
    March 24 (Reuters) - The Mexican peso held steady against
the dollar on Wednesday after four straight sessions of losses
as signs of quickening inflation raised expectations that the
central bank will hold interest rates after a policy meeting on
Thursday.
    The peso also outperformed its major emerging market
peers that were held down by a resurgent dollar.
    Mexico's national statistics agency said consumer price
inflation climbed to 4.12% during the first two weeks of March,
beating the consensus forecast of 3.91%, as per a Reuters poll
of analysts.
    The new level is the highest since the second half of May
2019 after it stood at 3.68% in late February. 
    A poll of economists earlier this week forecast the Bank of
Mexico's five-member board will likely leave interest rates
unchanged for the time being, though opinions were divided.

    The central bank cut its benchmark interest rate by 25 basis
points to 4% in February, flagging uncertainty over the
outlook.
    "We think Banxico will take a pass at a rate cut this time
around," Stephen Gallo, European head of FX strategy at BMO
Capital Markets said in a note. "Banxico has in the past been
exceptionally orthodox in its description and defense of its
inflation target...we expect that orthodoxy to play out this
time around."
    A strengthening dollar, a plunge in the Turkish lira after
the abrupt removal of the central bank chief and weaker
commodity prices all took a toll on developing world currencies
this week.
    Brazil's real extended losses for a third day after
the country suffered a record 3,251 COVID-19 deaths, underlining
the scale of the outbreak which is spiraling out of control,
thanks to a lumpy vaccine rollout and a messy patchwork of
public health restrictions.
    President Jair Bolsonaro said on Wednesday he will hold a
weekly meeting with the state governors to discuss the
pandemic.
    Brazil's Bovespa stock index got a boost from a 13%
surge in Carrefour Brasil's common shares after the
announcement of a 7 billion real ($1.3 billion) deal to acquire
rival BIG.
    Smiles Fidelidade gained almost 7% after airline
Gol Linhas Aereas Inteligentes raised the premium
paid to shareholders in a proposed merger with its loyalty
program. Gol's shares rose 5.7%.
    
    Key Latin American stock indexes and currencies:
       Stock indexes                Latest    Daily % change
 MSCI Emerging Markets              1303.39             -1.54
 MSCI LatAm                         2277.71             -0.64
 Brazil Bovespa                   114162.64               0.8
 Mexico IPC                        46680.13              0.04
 Chile IPSA                         4804.30              0.03
 Argentina MerVal                  48615.26             -1.16
 Colombia COLCAP                    1326.98              0.54 Currencies               Latest    Daily % change
 Brazil real                         5.5403             -0.45
 Mexico peso                        20.8680             -0.04
 Chile peso                           721.6              0.12
 Colombia peso                      3632.53             -0.43
 Peru sol                            3.7227             -0.08
 Argentina peso (interbank)         91.6300             -0.07
                                             
 

 (Reporting by Sruthi Shankar in Bengaluru)
  
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