*
      Currency index at highest since July


        *
      Brazil debt-to-GDP falls in January


        *
      Indexes set for weekly declines


        *
      Latam FX index up 0.9%, stocks up 3.5%



 (Updates with mid-session trading)
    By Lisa Pauline Mattackal, Shashwat Chauhan and Purvi
Agarwal
       March 14 (Reuters) - Latin American stocks and
currencies saw robust gains on Friday, helped by rising
commodity prices and as investors took a breather from a barrage
of U.S. tariff policy headlines.
    MSCI's index for Latin American currencies
was up 0.9%, trading near levels last seen in July, eyeing
slight gains for the week.
    "The postponement of U.S. tariffs until 2 April and
favorable political dynamics are generating a constructive
environment for LatAm FX," analysts at Societe Generale wrote,
adding they were "constructive" on Latam currencies.
    The Mexican peso, among the most sensitive currencies
to U.S. tariffs, rose 0.8%. U.S. Secretary of State Marco Rubio
said late Thursday that cooperation with Mexican authorities has
improved, but work still needs to be done on curtailing the flow
of illegal drugs.
    The real jumped 1% after data showed Brazil's debt to
GDP ratio fell unexpectedly in January. However, retail sales
slipped for a third consecutive month in January.
    Despite the signs of a slowdown, Brazil's central bank is
expected to hike rates to a near decade high at its meeting next
week to combat inflation.
    "Our sense is that there's just about enough weakness in the
economy to tip Copom towards ending the tightening cycle next
week... but the inflation challenge means there's a very
plausible scenario where they flag one or two more hikes, albeit
of a smaller magnitude," said William Jackson, chief EM
economist at Capital Economics.
    Oil prices rose, and gold jumped past the $3,000 per ounce
level for the first time, also aiding currencies and stocks.

    Miner Vale gained 3.2%. Brazil's Petrobras
 and Colombia's Ecopetrol rose 4.4% and 3.5%,
respectively.
    Argentina's Merval leapt 4.5%, while Brazil's
Bovespa was up 2.7%.
    MSCI's gauge of regional stocks jumped 3.5%,
set for its best day November 2023. The index saw steep losses
earlier as markets were hit by an escalating global tariff war
and concerns about slowing U.S. and global growth.
    Despite volatility, the Latin American stocks index has
gained nearly 13% this year, sharply outperforming the U.S.
benchmark index which has lost 4.4%.
    Peru's sol rose 0.3% after the central bank on
Thursday held its benchmark interest rate at 4.75%, as expected.
    Elsewhere, Trump said there is a "very good chance" the war
between Russia and Ukraine can end after "productive"
discussions with Russian President Vladimir Putin.
    That optimism helped lift stocks in Central and Eastern
Europe, which were further boosted after German political
parties reached an agreement on a key debt deal.
    Prices of Ukraine dollar bonds rose.
    Data showed Argentina's monthly inflation rate accelerated
to 2.4% in February, in line with analyst estimates.

    HIGHLIGHTS
    ** Donald Trump makes Chinese stocks (somewhat) great again
    ** Shares in Brazil's Natura &Co dive more than 25% after
quarterly results
    ** Peru central bank sees strong economic growth, limited
tariff blow

    Key Latin American stock indexes and currencies at 2007 GMT:








 MSCI Emerging Markets         1120.11       1.27

 MSCI LatAm                    2092.95       3.51
 Brazil Bovespa              129003.05       2.68
 Mexico IPC                   52505.56       1.21
 Chile IPSA                       7509       0.79
 Argentina Merval            2333215.6       4.53
                                     6
 Colombia COLCAP               1620.36       1.77








 Brazil real                    5.7405       1.01
 Mexico peso                    19.929       0.75
 Chile peso                     928.66       0.56
 Colombia peso                  4097.5       0.73
 Peru sol                        3.656       0.33
 Argentina peso (interbank)    1065.75       0.70

 Argentina peso (parallel)        1220       1.23



 (Reporting by Lisa Mattackal, Shashwat Chauhan and Purvi
Agarwal in Bengaluru; Editing by Susan Fenton and Alistair Bell)