* Mexican peso falls for second straight day * Brazil real hit by fiscal, political woes * Colombian peso tracks fall in oil prices By Shreyashi Sanyal Aug 26 (Reuters) - Latin American currencies fell on Thursday, with Mexico"s peso extending declines for a second day as the dollar firmed on worries about the fast-spreading Delta variant of the coronavirus ahead of the annual Jackson Hole, Wyoming, conference. The peso fell 0.7% to 20.3396 against the dollar, a day after data showed economic growth came in at 1.5%, slightly below expectations of 1.7%. The Mexican economy also shrank in June from May. A halt in the recent rally in oil prices also hurt Mexico"s currency, along with oil exporter Colombia"s peso, which fell 0.2% in early trading. The dollar rose from one-week lows, supported by gains in U.S. Treasury yields as investors continued to focus firmly on what signals the Fed might send at its annual conference. The virtual conference starts later Thursday, but all eyes will be on Fed chief Jerome Powell"s speech on Friday, where he is widely expected to signal when the central bank could start unwinding its monetary stimulus. Brazil"s real fell 0.7%, for the first time in three days amid a global bout of risk aversion on Thursday, as concerns about the country"s political and fiscal landscape lingered. Concerns about Brazil"s rickety public finances have hit the real in recent weeks, with the country"s government now aiming to pass a constitutional amendment that would give it more latitude in handling court-ordered payments of 89.1 billion reais ($16.98 billion) due in 2022. "With the introduction of dividend taxation and the reduction of the corporate tax rate, this reform should reduce Brazil"s short-term fiscal risk by increasing the tax burden on investment," said Cecilia Godoy, analyst for Latin America Research at FrontierView. "Still, political pressures to spend during next year"s election cycle will remain elevated, continuing to pose credible threats to the spending cap rule, Brazil"s main fiscal anchor." Chile"s peso struggled for direction, as prices of its main export, copper, fell. Most stocks across Latin America were weaker, taking cues from the rest of the globe. Mexican stocks dropped 0.5%, while the MSCI"s index for Latin American currencies slipped 0.3%. Key Latin American stock indexes and currencies at 1432 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1268.25 -0.55 MSCI LatAm 2464.05 -0.27 Brazil Bovespa 120815.16 0 Mexico IPC 52087.62 -0.49 Chile IPSA 4447.27 0.21 Argentina MerVal 71528.45 -0.667 Colombia COLCAP 1329.32 -0.04 Currencies Latest Daily % change Brazil real 5.2449 -0.66 Mexico peso 20.3334 -0.58 Chile peso 785.5 -0.33 Colombia peso 3866.1 -0.07 Peru sol 4.0843 -0.33 Argentina peso (interbank) 97.5400 -0.04 Argentina peso (parallel) 178.5 1.96 (Reporting by Shreyashi Sanyal in Bengaluru; editing by Jonathan Oatis) Our Standards: The Thomson Reuters Trust Principles.