EMERGING MARKETS-Most Latam currencies advance on commodity boost, Mexican peso lags

* Mexican peso lags regional peers * Brazil's Azul rises on narrower Q1 loss * Latam stocks up 0.5%, FX flat By Shashwat Chauhan May 13 (Reuters) - Most currencies in resources-rich Latin America rose on Monday, tracking strength in commodities such as iron ore and copper, while jittery investors awaited a crucial U.S. inflation print this week to gauge the path of U.S. interest rates. Brazil's real gained 0.3% against the dollar as iron ore prices, one of the country's biggest exports, climbed on news of more bond issuance by Chinese authorities to spur economic growth in the top consumer of the commodity. The real fell around 1.7% last week after Brazil's central bank cut rates in a split decision that saw appointees of the current government advocating for a larger reduction, sparking concerns of a forthcoming dovish monetary policy influenced by politics. Rising crude oil prices helped Colombia's peso rise 0.2% against the dollar, while rising copper prices pushed Chile's peso 0.7% higher. The Mexican peso was an outlier, falling 0.4% after a more than 1% weekly gain last week, while Peru's sol slipped 0.1% in choppy trading. The Bank of Mexico's five-member board will discuss the possibility of resuming interest rate cuts at the upcoming June 27 monetary policy meeting, following a rate hold last week, Governor Victoria Rodriguez told Reuters. "Banxico will persist with its gradualist approach to monetary policy management amid inflationary pressures lasting for longer," Wilson Ferrarezi, Brazil economist at TS Lombard said in a note. As of 10:38 a.m. ET (1438 GMT), MSCI's index for Latin American currencies was flat, while a gauge for stocks added 0.5%. Stocks in heavyweight Brazil added 0.8%, with communication services and real estate shares amongst top gainers. Azul gained around 3% after the Brazilian airline said its losses narrowed in the first quarter to 324.2 million reais ($62.86 million). Bourses in Mexico, Chile and Colombia also rose between 0.2% and 0.5%. The focus will remain on a consumer prices reading in the United States on Wednesday, a crucial metric to gauge whether the Federal Reserve will cut interest rates anytime soon. Meanwhile, staff of the International Monetary Fund (IMF) and Argentine authorities have reached agreement on the eighth review of the country's $44 billion extended fund facility arrangement, the Washington-based lender said. HIGHLIGHTS ** Romanian central bank surprises markets, holds benchmark interest rate ** India's retail inflation eases slightly in April, surge in food prices continues ** Polish rate-setters see CPI in target range in coming months -minutes Key Latin American stock indexes and currencies: Stock indexes Latest Daily % change MSCI Emerging Markets 1079.26 0.71 MSCI LatAm 2501.43 0.5 Brazil Bovespa 128535.50 0.73 Mexico IPC 57988.37 0.47 Chile IPSA 6660.66 0.3 Argentina MerVal 0.00 0 Colombia COLCAP 1390.38 0.24 Currencies Latest Daily % change Brazil real 5.1427 0.28 Mexico peso 16.8070 -0.34 Chile peso 919.8 0.55 Colombia peso 3878.5 0.23 Peru sol 3.7178 -0.08 Argentina peso 884.0000 -0.06 (interbank) Argentina peso 1020 1.96 (parallel) (Reporting by Shashwat Chauhan in Bengaluru; editing by Christina Fincher)