* Chilean peso set to lag peers this week * Mexican Q4 GDP better than expected * Most Latam stocks and currencies eye weekly losses By Ambar Warrick Jan 29 (Reuters) - Brazil"s real led losses across Latin American currencies on Friday after data highlighted weakness in the region"s largest economy, while Mexico"s peso was propped up by a better than expected reading of fourth quarter GDP. The real sank more than 1% versus the dollar after central bank figures showed national debt and the public sector deficit ended last year at record highs. Separate readings showed confidence in Brazil"s services sector fell in January, while annual producer price inflation also ended last year at a historic high. The data came in the wake of spiking COVID-19 cases and deaths in the Americas, with most Latam countries racing to roll out vaccines. Doubts over the passing of a $1.9 trillion U.S. stimulus package had also hurt risk-driven assets through the week, setting up Latam currencies for weekly losses. MSCI"s index of Latam stocks fell about 1% in early trade and was set to end lower on the week. Mexico"s peso rose 0.4% after fourth-quarter GDP beat expectations. But Latin America"s second-largest economy shrank by 8.5% last year due to the coronavirus, its worst slump since the Great Depression. Spiking COVID-19 cases in Mexico, coupled with uncertainty over the rollout of a vaccine program have hurt the peso in recent weeks. But the Mexican economy is expected to eventually benefit from a bounceback in its biggest trading partner, the United States. "In addition to global risk sentiment the decisive exchange rate driver is likely to be the prospect for the U.S. economy, and thus the decision on the U.S. fiscal package," Elisabeth Andreae, FX and EM analyst at Commerzbank wrote in a note. "If prospects there improve this is likely to support the peso as the export orientated country is likely to benefit via its close ties with the United States." Chile"s peso was set to lag its peers for the week with a 1.4% drop, as weakness in the copper market- Chile"s top export- hurt the currency. Chile"s central bank held interest rates at ultra-low levels this week, which is also expected to weigh on the peso. Colombia"s peso fell slightly ahead of a central bank meeting later in the day. The bank is expected to hold rates at a record low as it continues to try and boost an economy battered by the pandemic. Key Latin American stock indexes and currencies: Latest Daily % change MSCI Emerging Markets 1336.62 -1.03 MSCI LatAm 2336.47 -1.04 Brazil Bovespa 117975.94 -0.76 Mexico IPC - - Chile IPSA 4398.72 -0.27 Argentina MerVal - - Colombia COLCAP 1367.20 - Currencies Latest Daily % change Brazil real 5.4870 -0.93 Mexico peso 20.1550 0.38 Chile peso 733.9 0.53 Colombia peso 3543.63 0.42 Peru sol 3.6347 0.22 Argentina peso 87.2000 -0.09 (interbank) (Reporting by Ambar Warrick in Bengaluru; Editing by Kirsten Donovan)