* Colombian peso at over three-month high * IMF cuts global economic growth outlook * Brazil markets closed for holiday (Updates prices) By Ambar Warrick and Susan Mathew Oct 12 (Reuters) - Latin American currencies erased session losses on Tuesday to trade higher, with Chile"s peso recovering from 17-month lows hit on concerns that weaker Chinese demand could depress copper prices. But investors remained on edge over a global energy crunch, as well as a possible debt crisis in China, which is a major export destination for Latin America. A recent surge in oil prices raised concerns over high inflation, which could stifle economic growth in emerging market countries. The International Monetary Fund on Tuesday trimmed its 2021 global growth forecast to 5.9% from a previous estimate of 6.0%, with China"s cut by 0.1 point to 8.0%. Stocks in the region were mixed, with those in Chile and Colombia losing 1%, pushing the latter off their highest levels in over eight months, while main indexes in Mexico and Argentina rose 0.5% and 0.3%, respectively. "The IMF is concerned that surging prices will force central banks into tightening cycles that could trigger sell-offs in global equities," said Edward Moya, senior Americas market analyst at OANDA. An index of world stocks was 0.2% lower, with Wall Street making muted moves. Currencies of oil exporters Mexico and Colombia have gotten some support from crude prices in recent weeks, although analysts say this could be short-lived Mexico"s peso rose 0.6%, pulling up from over six-month lows as industrial output beat expectations in August. Colombia"s peso rallied 0.9% to over three-month highs. Colombia"s 2021 fiscal deficit may be lower than previously projected thanks to the recovery of oil prices and better economic growth, the government said. Chile"s peso firmed 0.3% after having fallen up to 0.8% during the session. Copper prices dropped on fears that a global energy crunch could stifle demand, particularly in major consumer China. Investors were also anticipating an interest rate decision from Chile"s central bank on Wednesday, in which it is expected to hike rates by 100 basis points (bps) to 2.50%, amid a recent spike in inflation. "Given recent macroeconomic and financial developments, the central bank would benefit from sending an unequivocal signal that it is determined to stay ahead of the rapidly deteriorating current and expected inflation dynamics," Goldman Sachs analysts said. The IMF on Tuesday also said emerging markets could face "destabilizing capital flows" as cryptocurrencies are used to circumvent exchange restrictions and capital controls. El Salvador last month became the first country to adopt bitcoin as legal tender. Markets in Brazil were closed. Key Latin American stock indexes and currencies: Stock indexes Latest Daily % change MSCI Emerging Markets 1254.27 -0.9 MSCI LatAm 2221.39 0.12 Mexico IPC 51905.69 0.5 Chile IPSA 4101.34 -1.07 Argentina MerVal 77821.44 0.346 Colombia COLCAP 1391.47 -1.05 Currencies Latest Daily % change Mexico peso 20.7492 0.51 Chile peso 821.5 0.29 Colombia peso 3718.4 0.86 Peru sol 4.0448 0.38 Argentina peso (interbank) 99.0900 -0.14 (Reporting by Ambar Warrick; editing by Jonathan Oatis and Cynthia Osterman) Our Standards: The Thomson Reuters Trust Principles.