EMERGING MARKETS-Latam FX muted, Chile's peso dragged lower by copper losses

    * Chile's peso at 17-month low
    * Colombian peso at one-month high on Moody's outlook
    * Chile central bank in focus 

    By Ambar Warrick
    Oct 12 (Reuters) - Chile's peso slipped to a 17-month low on
Tuesday as concerns over Chinese demand spurred losses in copper
prices, while broader Latin American currencies were muted as
fears of a global energy crunch kept sentiment muted. 
    The peso fell 0.6% to 829.1 to the dollar, its
weakest level since May 2020 as copper prices dropped on fears
that a global energy crunch could stifle demand, particularly in
major consumer China.
    Investors were also anticipating an interest rate decision
from Chile's central bank on Wednesday, in which it is expected
to hike rates by 100 basis points (bp) to 2.50%, amid a recent
spike in inflation.
    But analysts have questioned the efficacy of the hike, given
that the Chilean bank has been much slower to raise rates, in
comparison with its emerging market peers. The yield on the peso
is also relatively lower than currencies in Brazil and Mexico.
    "Given recent macroeconomic and financial developments, the
central bank would benefit from sending an unequivocal signal
that it is determined to stay ahead of the rapidly deteriorating
current and expected inflation dynamics," Goldman Sachs analysts
wrote in a note. 
    "We see it as a somewhat close call between a 75bp and a
bolder 100bp rate increase (possibly even up to 150bp)."
    Broader Latin American (Latam) currencies moved little as
investors remained on edge over a global energy crunch, as well
as a possible debt crisis in China, which is a major export
destination for Latam. 
    A recent surge in oil prices also raised concerns over high
inflation, which could stifle economic growth in emerging market
     But the currencies of oil exporters Mexico and
Colombia have gotten some support from crude prices in
recent weeks.
    Mexico's peso was flat on Tuesday, as industrial output beat
expectations in August. 
    Colombia's peso rose slightly to a one-month high.
The currency extended gains into a fourth straight session after
Moody's upgraded its outlook on the country, citing recent
economic resilience.
    Brazilian markets were shut for a holiday.
    Key Latin American stock indexes and currencies:
                              Latest     Daily % change
 MSCI Emerging Markets         1255.17              -0.83
 MSCI LatAm                    2218.49              -0.01
 Mexico IPC                   51703.88               0.11
 Chile IPSA                    4180.75               0.85
 Argentina MerVal                    -                  -
 Colombia COLCAP               1406.32                  0 Currencies             Latest     Daily % change
 Mexico peso                   20.8283               0.13
 Chile peso                      829.1              -0.62
 Colombia peso                 3742.82               0.21
 Peru sol                       4.0608              -0.02
 Argentina peso                99.1000              -0.15

 (Reporting by Ambar Warrick; editing by Jonathan Oatis)