EMERGING MARKETS-Latam FX gains on U.S. data; Chile peso up on growth report

SAO PAULO, Sept 5 Fri Sep 5, 2014 12:12pm EDT

SAO PAULO, Sept 5 (Reuters) - Latin American currencies were mostly stronger on Friday after weaker-than-expected U.S. job numbers weighed on the dollar, while Chile's peso got an additional boost from encouraging economic growth data.

Data on Friday showed U.S. employers hired the fewest number of workers in eight months in August, bolstering expectations that the U.S. Federal Reserve will wait longer before raising interest rates.

The data drove most Latin American currencies higher early in the session though gains were pared slightly in the afternoon.

Chile's peso gained about 1.3 percent against the dollar after central bank data showed Chile's economy grew faster than expected in July, raising the possibility that a slowdown may be close to touching bottom.

Mexico's peso strengthened about 0.5 percent against the dollar after the central bank kept interest rates on hold on Friday, as expected. The bank highlighted a welcome pickup in economic growth but indicated that annual inflation would take longer to subside towards its 3 percent target than it had earlier expected.

Brazil's real was little-changed.

On the equities front, the MSCI Latin American stock index fell for the second straight day.

Brazil's Bovespa stock index dropped for the third session in a row as traders waited for new electoral poll numbers in coming days.

Mexico's IPC stock index was nearly unchanged from the previous close, while Chile's IPSA stock index edged slightly lower. (Reporting by Asher Levine Editing by W Simon)

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