EMERGING MARKETS-LatAm FX inches closer to record high on trade truce, softer US inflation

By Nikhil Sharma and Pranav Kashyap

June 11 (Reuters) - An index tracking Latin American currencies was close to a record high on Wednesday, fueled by a preliminary U.S.-China trade truce and cooler-than-expected U.S. inflation data.

The MSCI's index for Latin American currencies .MILA00000CUS ticked up 0.4% to 3055.56, just shy of its mid-2011 record high of 3068.06.

Investors welcomed the Washington-Beijing truce , a framework brokered after two days of intense negotiations in London. According to the White House, this accord allows the U.S. to levy a 55% tariff on imported Chinese goods, while granting Beijing the reciprocal right to impose a 10% tariff on U.S. imports.

Wall Street's main stock indexes rose, while an index for Latin American equities .MILA00000PUS jumped 1.1% - hitting its highest in nearly nine months.

In Mexico, the peso MXN= rose as much 1% to its highest level in over nine months.

This was driven by Banxico Deputy Governor Jonathan Heath's comments in an interview with El Economista, hinting at a pause in the central bank's rate-cutting cycle amid an unexpected inflationary rebound.

The local equity index .MXX was down 0.3%.

Higher inflationary pressures have tightened their grip on Latin America's second-largest economy. Industrial output rose month-over-month in April, but contracted a worse-than-expected 4% from a year ago.

"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= clawed back 0.5% after a moderate retreat in the previous session, and Sao Paulo's benchmark stock index .BVSP nudged up 0.6%.

The Colombian peso COP= gained 0.6%, paring some of its sharp losses from the prior session. A Reuters report said the nation was contemplating boosting its external and domestic debt by several billion dollars this year to plug a deepening fiscal deficit.

Latin America's fourth-largest economy continues to grapple with deteriorating fiscal accounts, a casualty of lower tax revenues, persistently high public debt and stubborn challenges in expenditure reduction.

The Chilean peso <CLP=> rose 0.6%, while Santiago's stock index .SPIPSA jumped 1.3%.

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

Argentine traders also cheered a court's political ban on populist former President Cristina Fernandez de Kirchner, a powerful but divisive politician who often clashed with investors and creditors.

Argentina's benchmark stock index .MERV, which climbed 4.3% a day before, was down 1%.

Key Latin American stock indexes and currencies: