EMERGING MARKETS-Latam FX trends higher at start of rate verdict-packed week

By Shashwat Chauhan

March 17 (Reuters) - Most Latin American currencies perked up against a weakening dollar on Monday, kicking off a week packed with interest rate decisions across the world including in Brazil, Chile and the United States.

Front and center will be the Fed's interest rate decision on Wednesday, with markets widely expecting the central bank to hold its rate steady.

"Resumption of the Fed's rate cut campaign is most likely not in the cards for this week's FOMC," Glenmede strategists said.

"The Fed is expected to proceed with caution while awaiting more clarity on evolving developments for trade policy."

Data on Monday showed U.S. retail sales rebounded marginally in February.

Jitters around the ever-changing U.S. trade policy have rattled markets of late, with the dollar dipping against most developed market peers. Latin American currencies - including Mexico - have cashed in on the greenback's weakness.

Mexico's peso MXX= was last up 0.3% - hovering near its highest since November - having rebounded from its February lows when U.S. President Donald Trump's pledge to impose 25% tariffs on all goods coming from Mexico had shaken confidence.

Earlier this month, Trump exempted goods from both Canada and Mexico under a North American trade pact for a month from his 25% tariffs, with the exception set to expire on April 2.

Brazil's real BRL= strengthened 0.5% to a three-week high in the lead-up to a likely interest rate hike on Wednesday, bringing the Selic rate to 14.25%.

"There are doubts as to whether the Committee will include future guidance in its statement," StoneX analysts said in a note.

Central bank data released on Monday showed Brazil's economic activity grew more than expected in January.

Chile's peso CLP= firmed 0.9% ahead of a local interest rate decision on Friday, with expectations tilted towards the central bank holding rates steady at 5%.

Worries around a possible U.S. economic slowdown have weighed on global risk assets lately, though JP Morgan analysts note that EM stocks could be "accidental beneficiary" of the scare, upgrading their recommendation to "neutral" from "underweight".

MSCI's index for Latin American stocks .MILA00000PUS advanced 0.8%, taking its yearly gains to nearly 14%, far outperforming the U.S. S&P 500 .SPX, which has fallen almost 4% year-to-date and slipped into a technical correction last week.

Local bourses had an upbeat start to the week, with Brazil's Bovespa .BVSP gaining 0.4%, briefly hitting its highest level this year.

The much-broader MSCI gauge for EM stocks .MSCIEF, meanwhile, advanced almost 1% as investors assessed plans from the Chinese government to boost domestic consumption.

Equity markets in Mexico were closed for a public holiday.

Elsewhere, Kenya's international bonds fell with Kenya and the International Monetary Fund (IMF) set to discuss a new lending programme and abandon the current one.

Key Latin American stock indexes and currencies: