EMERGING MARKETS-Latam FX rise against muted dollar, commodity prices weigh on stocks

* Mexico's economy likely grew 2.2% in January * Declining iron ore prices pull Brazil's Vale lower * Carrefour Brasil down after vice chair's death * U.S. markets shut for Presidents' Day holiday * Currencies up 0.2%, stocks flat (Updated at 2:55 p.m. ET/ 1955 GMT) By Shashwat Chauhan and Ankika Biswas Feb 19 (Reuters) - Most Latin American currencies climbed against a subdued dollar on Monday in light trading as U.S. markets were closed for a public holiday, while weak commodity prices weighed on Latin American stock markets. As of 2:55 p.m. ET (1955 GMT), MSCI's gauge for Latam currencies was up 0.2%, with the U.S. dollar losing some steam after a five-week winning streak on strong inflation data. U.S. market participants were away on account of the Presidents' Day holiday. Leading the gains, Chile's peso rose 0.5% against the greenback, coming off a seventh consecutive weekly loss, while the Peruvian sol climbed 0.6%. The Brazilian real touched an over one-week high, last up 0.1%, after a central bank index showed economic activity expanded by 2.45% in 2023, surpassing initial forecasts of tepid growth in a high-interest-rate environment. "These data, overall, underline the relatively positive picture of the economy at the end of the year, thanks to falling inflation and interest rate cuts," said Andres Abadia, chief LatAm economist at Pantheon Macroeconomics. "Still, conditions are far from usual, and further policy normalization will be needed." Mexico's peso edged 0.1% higher ahead of the release of minutes from the country's central bank's last policy meeting on Thursday, where it held rates at 11.25%. A Reuters poll showed Mexico's headline inflation rate likely eased in the first half of February, reinforcing bets its central bank could soon lower rates. Separately, national statistics agency INEGI's preliminary estimate showed the Mexican economy likely grew 2.2% in January year-on-year. Meanwhile on Sunday, ahead of a presidential election in June, huge crowds filled Mexico City's main square in support of the nation's electoral authority, accusing President Andres Manuel Lopez Obrador of trying to weaken the body. Among others, Colombia's peso lost 0.3%. A gauge of EM stocks was largely muted, with Mexican shares losing 0.5% as global copper prices came under pressure, while crude oil prices also steadied. Among individual stocks, Carrefour Brasil dropped 2.4% after news billionaire Abilio Diniz, who served as the vice chairman of the retailer, had died on Sunday. HIGHLIGHTS ** Brazil's Lula unwelcome in Israel until he retracts Holocaust remarks, minister says ** Chile c.bank to cut interest rate by 100 bps in April, poll suggests ** Pakistan's majority parties struggle to form coalition government ** Nigeria's naira hits record lows, stocks sink Key Latin American stock indexes and currencies: Stock indexes Latest Daily % change MSCI Emerging Markets 1015.94 -0.03 MSCI LatAm 2553.57 -0.01 Brazil Bovespa 128696.09 -0.02 Mexico IPC 56873.23 -0.45 Chile IPSA 6382.51 0.72 Argentina MerVal 1079190.17 1.297 Colombia COLCAP 1218.96 -3.02 Currencies Latest Daily % change Brazil real 4.9606 0.09 Mexico peso 17.0383 0.07 Chile peso 965.8 0.53 Colombia peso 3915.5 -0.29 Peru sol 3.7849 0.60 Argentina peso (interbank) 836.7000 -0.19 Argentina peso (parallel) 1090 0.46 (Reporting by Shashwat Chauhan and Ankika Biswas in Bengaluru; Editing by Emelia Sithole-Matarise and Chris Reese)