EMERGING MARKETS-Latam FX falls as dollar firms globally after US inflation ticks up

By Ragini Mathur, Purvi Agarwal and Shashwat Chauhan

July 15 (Reuters) - Most Latin American currencies edged lower against a firm dollar on Tuesday after U.S. inflation data suggested the Federal Reserve would not rush to cut interest rates, while ongoing U.S. trade negotiations kept markets cautious.

U.S. consumer prices rose at the fastest pace in five months in June, indicating tariffs were beginning to affect inflation and could keep the Federal Reserve on hold until September.

"As uncertainty remains high, the (Fed) may take some time to get the clarity it is looking for," TD Securities strategists, led by Chief U.S. Macro Strategist Oscar Munoz, said in a note.

"While we expect the USD to get a temporary reprieve, the bounce is unlikely to be meaningfully sustained."

The dollar index =USD, which tracks the greenback against a basket of currencies, climbed 0.5%, while MSCI's broad index for Latin American currencies .MILA00000CUS fell 0.1%.

U.S. President Donald Trump escalated his trade war over the past week by imposing broad tariffs on several emerging markets in Asia, Brazil, and Mexico, set to take effect on August 1.

Markets, however, found some reassurance as Trump signaled openness to negotiations, raising hopes that final tariff levels could be reduced through diplomatic efforts.

Mexican President Claudia Sheinbaum said Mexico would take action if an agreement with Washington on the new tariffs is not reached by the August 1 deadline.

The peso MXN=, one of the region's most liquid currencies, fell 0.5%, briefly hitting a more than two-week low.

Brazilian Vice President Geraldo Alckmin said Brazil would work to persuade the U.S. to reverse "as quickly as possible" the 50% tariff imposed on all goods from the country but did not rule out requesting more time for negotiations .

This follows news overnight that Brazilian President Luiz Inacio Lula da Silva will sign a decree on reciprocal tariffs on Monday, establishing the criteria for Brazil's response to foreign trade measures impacting the economy.

The Brazilian real BRL= rose 0.5% against the dollar in volatile trading.

Colombia's peso COP= slipped 0.8% on low volumes. Trump's 50-day ultimatum to Russia to end its war in Ukraine or face sanctions weighed on oil prices, further pressuring the peso.

The regional stocks benchmark .MILA00000PUS was flat, with Brazilian shares .BVSP trading steady.

On the tariff front, Trump announced the U.S. would impose a 19% tariff on goods from Indonesia under a new agreement.

Foreign investor inflows into debt markets lifted investments in emerging market stocks and bonds to a nine-month high of $42.8 billion in June, according to data from the Institute of International Finance.

HIGHLIGHTS

** Peru's economy grows more than expected in May despite mining dip

** India in talks with Chile, Peru to source critical minerals, source says

** Mexico regulator fines financial institutions sanctioned by US, local media report

Key Latin American stock indexes and currencies: