* Brazil"s real set to outperform Latam peers for week * Chilean peso rises as copper prices gain * MSCI Latam stocks index rises 1% (Adds comments, bullets, updates prices throughout) By Susan Mathew and Shreyashi Sanyal May 27 (Reuters) - Brazil"s real rose against the dollar on Thursday, while most other currencies in Latin America steadied after declines earlier in the session as the dollar edged lower. Brazil"s real rose 1.3%, putting it on course to mark the biggest weekly gain among major Latam peers. A survey on Thursday showed Brazilian industrial confidence rose in May, the first rise in five months. But separate data showed unemployment hit a historic high of 14.7% in the quarter to March. "BRL poses an interesting risk-reward profile, but real yield levels remain relatively low for now," said FX strategists at TD Securities. The dollar remained subdued against the backdrop of easing inflation fears keeping monetary policy accommodative, benefiting riskier currencies. But with talk of tapering rising, investors kept their eyes peeled for even the slightest mention of a shift in policy. Chile"s peso rose more than half a percent as copper prices rose. The currency had posted its best session in almost two weeks on Wednesday after the copper price was lifted by workers threatening to strike at the world"s biggest copper mine, Escondida. Currencies in the region came under pressure earlier in the session as U.S. Treasuries yields rose after the New York Times reported President Joe Biden will announce on Friday what analysts said could be the largest spending since World War 1. Peru"s sol edged higher but hovered near all-time lows with all eyes on the final round of the presidential election race between two polarized candidates - the latest in a string of political risk events haunting investors in Latin America, a region struggling to keep up with its global peers despite a commodities boom. Falling oil prices on the possible return of Iranian supply kept Mexico"s peso pressured. Stocks in Sao Paulo rose 0.2%, inching closer to January highs, while Chilean stocks climbed nearly 1%. Emerging market stocks have maintained a slower pace of recovery from the pandemic when compared to more developed economies. The MSCI"s index for emerging market stocks rose 0.2%, while the index for Latin American equities added 1%. "We forecast that emerging market equities will make further gains between now and end-2022 as the global economy recovers further," said Simona Gambarini, markets economist at Capital Economics. "However, they have lost a bit of ground to developed market (DM) equities recently and we doubt they will perform much better than them in the coming year and a half." Latin American stock indexes and currencies at 1924 GMT; Stock indexes Latest Daily % change MSCI Emerging Markets 1354.05 0.16 MSCI LatAm 2498.44 1.04 Brazil Bovespa 124186.29 0.16 Mexico IPC 49411.83 0.63 Chile IPSA 4157.66 0.94 Argentina MerVal 57727.99 1.995 Colombia COLCAP 1202.31 0.97 Currencies Latest Daily % change Brazil real 5.2507 1.17 Mexico peso 19.9830 -0.58 Chile peso 725.4 0.44 Colombia peso 3719.46 0.57 Peru sol 3.8458 0.18 Argentina peso (interbank) 94.5300 -0.04 Argentina peso (parallel) 154 0.65 (Reporting by Susan Mathew and Shreyashi Sanyal in Bengaluru; Editing by Nick Macfie and Grant McCool) Our Standards: The Thomson Reuters Trust Principles.