* Brazil equities gain after five straight days of decline
* Brazil 2019 inflation exceeds economists' forecast
* Investors turn optimistic as fears of Middle East war fade
* Mexican peso firms; Argentinian and Chilean stocks gain
By Sagarika Jaisinghani and Susan Mathew
Jan 10 (Reuters) - Brazilian stocks rose for the first time
in six days on Friday on better-than-expected inflation figures,
while the easing of U.S.-Iran tensions lifted Latin American
equities.
Brazil's stock index gained 0.4% and the real
firmed 0.3% as data showed consumer prices rose at a
faster-than-expected pace in 2019, mainly led by higher meat
prices.
The figures were the latest indication of a slight pickup in
Latin America's largest economy and will potentially further
delay interest rate cuts by the central bank after four
consecutive reductions last year, analysts said.
"In Brazil, the rate cut cycle had ended and inflation is
high enough that the central bank has to be cautious about
cutting rates (further)," said Win Thin, global head of emerging
market currency strategy at Brown Brothers Harriman.
"The takeaway is that the economy remains soft."
Investor sentiment was dented earlier in the week on
concerns of a additional strife in the Middle East after the
United States killed a top Iranian general, prompting a
retaliation.
But in the absence of further military action by both
countries, world stock markets notched record highs on Friday as
investors turned optimistic about faster global growth in 2020.
Wall Street also hit all-time opening highs, powered by tech
stocks.
Argentinian equities added 1.2%, while Chilean
stocks rose 0.3%. A Reuters poll on Friday showed
Chile's economy is expected to start expanding again in 2020
after intense social unrest last year.
The Mexican peso firmed about 0.4% and was on track
for its fifth weekly increase in six. Data on Friday showed
Mexican industrial output rose 0.8% in November from October,
the first monthly rise since August.
The region's currencies will tread carefully this year amid
continuing political tensions and worries over more
protectionist talk in the U.S. presidential election campaign
later in 2020, a Reuters poll of analysts showed.
Key Latin American stock indexes and currencies at 1459 GMT:
Stock indexes Latest Daily % change
MSCI Emerging Markets 1134.37 0.44
MSCI LatAm 2926.32 0.31
Brazil Bovespa 116412.85 0.4
Mexico IPC 44594.21 0.05
Chile SPIPSA 4913.54 0.31
Argentina MerVal 42548.43 1.22
Colombia Colcap 1651.98 -0.09 Currencies Latest Daily % change
Brazil real 4.0738 0.26
Mexico peso 18.7913 0.22
Chile peso 771.8 -0.56
Colombia peso 3274.23 -0.68
Peru sol 3.3198 0.01
Argentina peso (interbank) 59.8150 -
(Reporting by Sagarika Jaisinghani and Susan Mathew in
Bengaluru; Editing by Dan Grebler)
Our Standards: The Thomson Reuters Trust Principles.