EMERGING MARKETS-Latam currencies rise on commodities boost; Argentina's peso falls

* Mexico annual inflation leaps to 8.70% in August * China debt sees portfolio outflows in August - IIF (Updates prices, adds comment) By Anisha Sircar and Amruta Khandekar Sept 8 (Reuters) - Major resource-rich Latin American currencies rose against the dollar on Thursday on stronger commodity prices, while Argentina's peso slipped on a report that its central bank left interest rates unchanged. Inflation in Mexico, Latam's second-largest economy rose to 8.15% in the year through August from 8.15% in July, the highest in nearly 22 years. That supported bets the central bank may continue raising the key interest rate to slow soaring prices. A Reuters poll of analysts had forecast 8.67% annual inflation. The peso edged up 0.2% in volatile trading. "We expect Central Bank of Mexico to continue to follow the Fed and hike rates. It could be as much as 50 or 100 basis points hike," said Louis Lau, director of investments at Brandes Investment Partners. Brazil's real jumped 0.8% as prices of key export commodities gained. Crude prices rose after Russia threatened to halt oil and gas exports to some buyers, while iron ore futures firmed after the Chinese city of Zhengzhou said it would start building stalled housing projects, soothing worries about weak steel demand. Oil exporter Colombia's peso inched up, while stronger copper prices lent support to Chile's peso and Peru's sol, up 0.2% and 0.4%, respectively. Data showed Chile's inflation rose to 1.2% in August, above the expected 1% rise, and took the Andean country's 12-month rate of consumer price increases to 14.1%, far above the central bank's target range of 2% to 4%. Investors await an interest rate decision from Peru later in the day, with analysts expecting a rate increase of 25 or 50 basis points. Peru's finance ministry unveiled an economic package it says can help boost the economy by 0.6% this year and 0.8% in 2023 amid worries of slowing global growth. Latam's currency gained as the dollar struggled for direction after Fed Chair Jerome Powell said on Thursday the bank was "strongly committed" to controlling inflation. "This current environment of higher interest rates, stronger dollar doesn't bode well for Latin American currencies," Lau said. "The outlook seems quite bearish in the short term until the Federal Reserve maybe sometime in 2023 gets to peak interest rates and stops increasing interest rates and then that's when maybe the Latin American currencies will start to stabilize." Jitters over central banks' measures to curb soaring inflation, and fears of higher borrowing costs dampening demand, has pressured riskier EM and Latam assets in recent weeks after a strong first half of the year boosted by higher commodity prices. Argentina's tightly controlled peso slipped 0.23% as a source told Reuters its central bank left the country's interest rate unchanged after the board opted to keep it off the agenda at its weekly meeting due to a lack of "consensus," even though annual inflation is running at over 70%. Elsewhere, China debt markets lost $7.7 billion in August in a seventh straight month of portfolio outflows, data from the Institute of International Finance showed. EMs ex-China enjoyed portfolio inflows, with equities gaining $20.3 billion and debt attracting $13.5 billion. Key Latin American stock indexes and currencies at 1922 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 956.98 0.05 MSCI LatAm 2153.22 1.02 Brazil Bovespa 109721.72 -0.04 Mexico IPC 46298.16 0.52 Chile IPSA 5527.82 -0.23 Argentina MerVal 141414.35 0.293 Colombia COLCAP 1203.26 -0.58 Currencies Latest Daily % change Brazil real 5.2049 0.65 Mexico peso 19.9442 0.11 Chile peso 880 0.40 Colombia peso 4390.7 0.06 Peru sol 3.8703 0.21 Argentina peso (interbank) 141.1100 -0.21 Argentina peso (parallel) 276 2.90 (Reporting by Anisha Sircar, Amruta Khandekar and Devik Jain in Bengaluru; Editing by Andrea Ricci and Richard Chang)