EMERGING MARKETS-LatAm currencies gain on Greek bailout

* LatAm FX mostly stronger after Greek bailout approved

* MSCI's LatAm stock index dips, Brazil a drag

By Daniel Bases

NEW YORK, May 3 (Reuters) - Latin American currencies edged
higher on Monday after an agreement to provide Greece with a
110 billion euro fiscal rescue package.

However with much of Europe on holiday, light trading
volumes kept any rallies to a minimum that could, as one
economist put it, lead to some "upside follow-through
tomorrow."

European Union and International Monetary Fund support for
Greece raised hopes the euro zone could contain sovereign debt
problems and prevent them from impacting global markets.

"There was a bit of a relief rally on the back of the Greek
package that was approved," said Doug Smith, chief economist
for the Americas at Standard Chartered Bank in New York.

"There is some uncertainty until the implementation of it
begins. That is going to be the big thing, but this probably
takes some of the immediate pressure off. This is going to be a
long, drawn out process," he said.

In currencies, the Brazilian real rose 0.35 percent to
1.7320 per U.S. dollar BRBY.

On Monday, Brazil's central bank called a second auction to
buy U.S. dollars on the spot foreign exchange market as part of
an effort to boost international reserves and limit currency
market volatility. The Brazilian government has stepped up its
intervention recently as the real has firmed against the
dollar.

The Mexican peso rose 0.48 percent to 12.2561 per greenback
MEX01MXN=.

"The news from Europe is calming," said Omar Martin del
Campo, a trader at Banco Ve por Mas in Mexico City. "Things are
returning to the normality we saw before the data on ratings."

In addition, Mexico benefited from strong U.S. economic
data, including the fastest pace of growth in nearly six years
for manufacturing activity last month as well as rising
consumer spending. [ID:nN03207244]

The United States buys around 80 percent of Mexican exports
and the two countries closely-linked factories operate in lock
step. Mexico is counting on a solid rebound in U.S. consumer
demand to fuel a recovery from a deep recession last year.

Greece's bailout includes onerous austerity measures of
spending cuts and tax increases totaling 30 billion euros on
top of tough measures already taken. [ID:nLDE6400CL]

The package now goes before national governments for a vote
where gaining approval is not expected to be a smooth process.
Likewise it does not address the possibility of debt problems
in other members of the euro zone.

The uncertainty meant it was not a one-way ticket to buying
across the asset classes.

The MSCI Latin America stock index lost 0.88 percent on the
day .MILA00000PUS. Brazil's Bovespa was the main drag on the
region, dropping 0.61 percent .BVSP, while stocks in Mexico,
Chile and Colombia gained ground.

The benchmark JP Morgan Emerging Markets Bond Index Plus
11EMJ.JPMEMBIPLUS showed yield spreads narrower by 4 basis
points to 261 basis points over weaker U.S. Treasuries.

(Additional reporting by Luciana Lopez in Sao Paulo, and
Jean Luis Arce and Michael O'Boyle in Mexico City; Editing by
Andrew Hay)