EMERGING MARKETS-Latam currencies firm on weak U.S. payrolls; weekend elections eyed

    * Peru presidential race to be tight, sol volatile 
    * Brazil's real best weekly performer, up 3.5%
    * Colombian peso set for best week this year

 (Adds details, updates prices)
    By Susan Mathew and Ambar Warrick
    June 4 (Reuters) - Latin American currencies firmed on
Friday as disappointing U.S. payrolls data dented expectations
of imminent policy tightening, while the focus turned to weekend
elections in Mexico and Peru. 
    The below-expectation U.S. nonfarm payrolls data eased
worries that the pace of economic rebound could fan inflation
and prompt a change in U.S. monetary policy.
    "The data has helped calm fears that ... the Fed could start
to taper support sooner," said Fiona Cincotta, senior financial
markets analyst at City Index, referring to the Federal
Reserve's monthly purchase of bonds, designed to hold down
interest rates and spur growth.
    The data hit the dollar, while U.S. stocks rallied,
providing cues for stocks in Latam. The prospect of
accommodative U.S. rates benefits high-yielding emerging market
    Weekend events in Peru and Mexico will be keenly watched,
with Peru choosing its president, while mid-term elections in
Mexico have the capacity to determine the course of economic
reforms in the country. 
    The Mexican peso rose 1%. Fluctuations in oil prices
and worries around the election pushed it around 0.4% lower for
the week.
    Peru's sol recovered sharply from near-record lows. 
    Recent polls suggested that Peru's presidential race will be
tightly fought between right-wing conservative Kieko Fujimori
and socialist rival Pedro Castillo, whose visions for the
country stand in stark contrast to each other.
    "We would not be surprised if results take longer to be
declared final by the electoral authority," strategists at
Credit Suisse said, which could mean a prolonged period of
market uncertainty.
    Whoever wins, the Andean country is set for a volatile and
uncertain road ahead, analysts say.
    Colombia's peso tracked rising oil prices to add
1.5%. On the week, the currency is up about 2.8% - its best week
this year.
    Colombia's government is struggling to push a watered-down
tax reform through a reticent Congress. The earlier proposal had
sparked violent nationwide protests and resulted in the
country's losing one of its three investment-grade ratings.

    Brazil's real gained 0.7% as the country returned
from a day's holiday, rising for a seventh straight session
. The real was the best performer in Latam this week,
surging 3.5% on upbeat economic growth numbers and as rising
inflation brewed expectations of more policy tightening.
    Iron ore miner Vale fell 1.9% after it 
interrupted production at its Timbopeba mine and part of its
Alegria mine after prosecutors ordered the evacuation of an area
around the nearby Xingu dam.
    Key Latin American stock indexes and currencies:
                              Latest      Daily % change
 MSCI Emerging Markets         1382.97               -0.04
 MSCI LatAm                    2665.65                0.51
 Brazil Bovespa              129876.87                0.21
 Mexico IPC                   50426.44                -0.4
 Chile IPSA                    4196.66               -0.72
 Argentina MerVal             65338.43                1.61
 Colombia COLCAP               1245.35               -1.03 Currencies             Latest      Daily % change
 Brazil real                    5.0470                0.70
 Mexico peso                   19.9443                1.05
 Chile peso                     717.88                0.09
 Colombia peso                 3601.52                1.59
 Peru sol                         3.84                0.78
 Argentina peso                94.8600               -0.04

 (Reporting by Susan Mathew and Ambar Warrick in Bengaluru; 
Editing by Nick Tattersall and Leslie Adler)