(Corrects milestone to "one-week high" from "two-week high" in headline and paragraph 1) By Shreyashi Sanyal Aug 11 (Reuters) - The Mexican peso jumped to its highest level in one week on Tuesday after data showed industrial output rose in June in a sign of recovery following the coronavirus lockdown, while other Latin American currencies strengthened against a weaker dollar. The peso gained 0.9% against the greenback on Mexican industrial output rising 17.9% in June from May led by a rebound in manufacturing and construction. Investors are awaiting the Mexican central bank's policy meeting, markets expecting an interest rate cut later this week to the lowest level in four years. "The consensus is for a 50bps rate cut, as the bank struggles to prop up the economy and keep the peso from deflating. Banxico officials have continued to provide contradicting signals about forthcoming bank policy, giving the market increased uncertainty," said analysts at Orbex Global. Brazil's real firmed against the dollar, with minutes from the latest central bank meeting showing Brazilian interest rates are close to as low as they can go without destabilizing financial markets, meaning any further reductions will likely be gradual and spaced out over time. The Chilean peso bounced from a one-month low it hit during the previous session. Signs of improvement in copper demand from China has helped support the currency. Stocks in the region followed Wall Street's strong open, with Chilean stocks rising the most in Latin America. Brazilian lender Banco BTG Pactual SA rose 1.8% even as its second-quarter recurring net income fell 4.1% to 987 million reais on higher operating expenses. More unrest hit Peru, as angry residents in Andean and Amazon regions have attacked three mining and oil sector firms in the last week, two of which were forced to halt operations after deadly clashes, as a second wave of COVID-19 infections hits the country. Latin American stock indexes and currencies at 1400 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1093.73 0.67 MSCI LatAm 2022.50 -0.02 Brazil Bovespa 104264.62 0.79 Mexico IPC 38786.48 1.3 Chile IPSA 4018.38 0.86 Argentina MerVal 0.00 0 Colombia COLCAP 1151.31 0.68 Currencies Latest Daily % change Brazil real 5.4571 0.13 Mexico peso 22.3774 0.31 Chile peso 796 0.83 Colombia peso 3746.25 0.51 Peru sol 3.5587 0.03 Argentina peso (interbank) 72.9900 -0.05 Argentina peso (parallel) 127 4.72 (Reporting by Shreyashi Sanyal in Bengaluru; editing by Grant McCool)
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