EMERGING MARKETS-Latam FX near record high after Sino-US truce, softer US inflation print

By Nikhil Sharma

June 11 (Reuters) - A measure of Latin American currencies stepped closer to a record high on Wednesday after the United States and China agreed on a framework for a trade deal, while broader sentiment also benefited from softer-than-expected U.S. inflation data.

MSCI's index for Latin American currencies .MILA00000CUS was up 0.4%, a few points away from an all-time high.

In contrast, the U.S. dollar index =USD eased after data showed underlying inflation in the world's largest economy rose less than expected last month, making room for interest rate cuts by the Federal Reserve.

Investors welcomed the U.S.-China deal, reached after two days of negotiations in London, that, according to the White House, allows the U.S. to charge a 55% tariff on imported Chinese goods and permits Beijing to charge a 10% tariff on U.S. imports.

Wall Street's main stock indexes rose, while an index for Latin American equities .MILA00000PUS jumped more than 1.1% - set for its best day in nearly a month.

In Mexico, the local peso MXN= advanced 0.5% against the dollar to a near one-year high, with data showing industrial output rose in April from March. However, production declined by a worse-than-expected 4% on a yearly basis. The local equity index .MXX was down 0.1%.

Higher inflationary pressures have gripped Latin America's second-largest economy, which could put the Bank of Mexico's policy easing cycle on hold, according to deputy governor Jonathan Heath.

Economists polled by Reuters still expect that the central bank will implement its fourth consecutive rate cut of 50 basis points.

"The (inflation) numbers this week were not looking very good, but it's probably not that high that it requires an interest rate that is double-digits," said Michael Pfister, FX analyst at Commerzbank.

"The Mexican Central Bank was a bit late on cutting interest rates... And now that the real economy is not looking good and the growth numbers are rather weak, they need to do more stimulus."

Brazil's real BRL= was up 0.6% after moderate losses in the previous session, with Sao Paulo's main stock index .BVSP edging up 0.1%.

The Colombian peso COP= rose 0.4%, after sharp losses in the prior session as selling pressures emerged after a Reuters report said the government was temporarily suspending compliance with its fiscal rule.

The suspension would allow the government to raise its targeted fiscal deficit for the year from the previously forecast 5.1% of gross domestic product (GDP).

The local stock index .COLCAP was steady, following a 0.84% rise in the previous session.

The peso of the world's biggest copper producer Chile CLP= rose 0.3%. Tuesday's data showed copper production from Chilean state-run miner Codelco [RIC:RIC:COBRE.UL] ticked up nearly 21% year-over-year in April.

The Santiago stock index .SPIPSA jumped more than 1.2%.

Equities in Argentina were in focus after gaining traction on Tuesday, when the government unveiled new economic measures to boost the country's depleting foreign currency reserves.

Argentina's benchmark stock index .MERV, which climbed 4.3% a day before, was down 0.7%.

In other emerging markets, the Polish zloty currency EURPLN= was steady and the local stock index .WIG dropped 0.6% as investors monitored a vote of confidence in Prime Minister Donald Tusk's government.

Key Latin American stock indexes and currencies: