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EMERGING MARKETS-Latam assets weaken, head for weekly falls as Evergrande worries linger

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* Brazilian real leads weekly declines in Latam * Chile's 2022 draft budget seeks to tame deficit -Pinera * Mexican retail sales fall in July By Shreyashi Sanyal Sept 24 (Reuters) - Most currencies and stocks across Latin America were subdued on Friday as questions arose about whether China Evergrande will make a key interest payment that could avoid a potential global fallout, with Brazil's real lagging its peers for the week. The MSCI's index for Latin American currencies was down 0.8%, with the currencies taking cues from Asian counterparts on fears that Beijing will let overseas bondholders swallow large losses as a liquidity crisis deepens at China Evergrande. Brazil's real weakened 0.5% against the dollar in early trading a day after the Brazilian central bank's move to raise interest rates was seen as less hawkish than expected. The currency is headed for its third straight weekly decline to fall nearly 1%. Adding to the downbeat mood, data showed consumer confidence in Brazil reached a 5-month low in September, as higher inflation, potential problems in electricity supplies and political uncertainty contributed to pessimism. "The significant rise in inflation since the beginning of the year amid still high unemployment rates are likely the main reasons behind the recent deterioration in consumer confidence," strategists at Citi Research wrote in a client note. Brazil's central bank also detailed the credit lines that it will offer to banks at the end of the year, when emergency loans issued in 2020 to ride out the pandemic will expire. The Mexican peso dipped 0.4%, set to close the week with declines of 0.6%. Data showed Mexican retail sales fell 0.4% in July from June. Copper producer Chile's currency was also set to end the week with declines. The country's President Sebastian Pinera unveiled an $82.1 billion draft budget for 2022 on Thursday that he said would begin to tame a ballooning deficit, following more than a year of emergency spending to combat the coronavirus pandemic. The Colombian peso fell 0.3%, while Peru's Sol bucked the trend to firm 0.4%. Latin American bourses also traded decidedly in the red, with the MSCI's index falling 1.4% and tracking its fourth straight weekly loss. Chilean shares fell 1.1%, leading declines among its peers, tracking lower copper prices. Key Latin American stock indexes and currencies at 1405 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1264.49 -0.63 MSCI LatAm 2306.54 -1.24 Brazil Bovespa 112895.24 -1.02 Mexico IPC 51366.49 -0.19 Chile IPSA 4365.14 -1.06 Argentina MerVal 0.00 0 Colombia COLCAP 1312.27 0 Currencies Latest Daily % change Brazil real 5.3353 -0.51 Mexico peso 20.0900 -0.23 Chile peso 787.5 -0.38 Colombia peso 3841.14 -0.25 Peru sol 4.1026 -0.17 Argentina peso (interbank) 98.5500 -0.01 Argentina peso (parallel) 182 1.65 (Reporting by Shreyashi Sanyal in Bengaluru; Editing by Andrea Ricci)

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