EMERGING MARKETS-Latam FX, stocks eye biggest weekly losses in over a month

By Shashwat Chauhan and Lisa Pauline Mattackal

March 28 (Reuters) - Most Latin American currencies and stocks lost ground on Friday and were headed to their biggest weekly losses since last month, as risk sentiment remained weak after U.S. President Donald Trump's latest volley of tariffs.

MSCI's index tracking the region's currencies .MILA00000CUS dropped 0.6%. The Latin American equity index .MILA00000PUS dipped 1.5%, on track for a near 2% drop for the week.

Both the stocks and currency index were at two-week lows.

Risk sentiment remained shaky through the week after Trump imposed a 25% tariff on imported cars and light trucks starting on April 3.

Adding another layer of uncertainty to global trade, U.S. data showed underlying price pressures increasing by the most in 13 months in February, likely keeping the Federal Reserve cautious on rate cuts.

The focus is now on U.S. reciprocal tariffs due to be announced on Wednesday. Trump, however, indicated that the measures may not be the like-for-like levies he has been vowing to impose.

Latin American stocks and currencies remain set for solid monthly gains, aided by a global rotation out of U.S. equities and a broadly softer greenback.

Broader indexes tracking global emerging market stocks .MSCIEF and currencies .MIEM00000CUS are also on track for monthly gains.

"Markets are still pricing somewhat benign commentary or tariffs," said Joan Enric Domene, chief LatAm economist at Oxford Economics.

"Given some time, some concessions, some room for hope that there is still a deal (on tariffs) to be made, we can still see that over-performance of some assets in the EM world," Domene said.

Mexico's peso MXN=, among the region's most tariff-sensitive currencies, fell 0.6% to an over three-week low. Data showed the country's seasonally adjusted unemployment rate was 2.7% in February.

Brazil's real BRL= weakened 0.3%, down for a third straight day and on pace to snap a three-week winning streak.

Data showed unemployment in Latin America's biggest economy rose in the quarter through February, matching expectations from economists polled by Reuters. Meanwhile, federal public debt rose 3.3%.

Chile's peso CLP= dropped 1.8% as copper prices fell ahead of next week's tariff deadline. The CEO of Codelco, the world's largest copper producer, said it had been redirecting some of its spot sales to the U.S.

Brazil's Bovespa .BVSP dropped 0.7%. The Argentinian benchmark .MERV slid 1.4%, leading losses among regional indexes.

The International Monetary Fund confirmed that the program it is discussing with Argentina was requested to be for $20 billion, as announced by the Argentine government, and that it would be an Extended Fund Facility.

HIGHLIGHTS

Chile copper miner Codelco swings to profit in 2024

Ukraine says mineral deal not final; summary shows US demands more income

Mexico announces second-quarter auctions for government debt

Key Latin American stock indexes and currencies: