Brazil"s real led gains among Latin American currencies on Thursday as basic material and metal prices rose on China Evergrande cheer, while Mexico"s peso gained ahead of a central bank interest rate decision later in the day. Mexico"s peso rose 0.7% with the Mexican central bank, locally known as Banxico, set to raise interest rates for the fourth consecutive time at its monetary policy meeting. Estimates are for a 25 basis points hike to 5%, in its decision due at 2 pm ET (1900 GMT). Data earlier this week showed Mexican inflation surged in October reaching a rate more than double the central bank"s target, cementing the need for more rate hikes. "If the bank were to increase the policy rate by 50bps instead of 25bps, we think that financial markets would likely see it as a definite acceleration in the tightening pace," wrote analysts at Credit Suisse in a note. "Through this route, the bank would run the risk of ending up with an unnecessarily high terminal rate, when considering that this year"s inflation shock is unlikely to persist into 2022." Peru"s central bank is also seen hiking by 50 basis points later on Thursday to 2%. The sol was steady ahead of the meeting. Brazil"s real surged 1.3%, taking support from a rise in iron ore and copper prices after Chinese property developer Evergrande made its bond payments, raising hopes of government support for a property sector that can drive significant demand for metals. Analysts at Bradesco also pointed to a certain level of uncertainty reduction after Brazil"s lower house approved a constitutional amendment allowing for more spending. But Senate passage is now awaited. Sao-Paulo listed shares surged 2%, with the index set for its best session in over two weeks. Brazilian airline Azul SA, rose 4.3% despite a wider net loss for the third-quarter thanks to higher expenses on loans and leases. Emerging market currencies had taken a hit in the previous session after a surge in U.S. inflation raised rate hike bets there, sending the dollar to 16-month highs and bond yields rising. South Africa"s rand rallied 1%, nearing seven-week highs, attempting to make back Wednesday"s 2.7% drop post U.S. inflation data. In its medium-term budget policy statement here, South Africa cut its deficit forecast, and now sees debt peaking at a lower level. Rising copper prices helped top producer Chile"s peso gain 0.5%. Chile"s economy is set to grow more than 11% this year amid a rapid recovery from the impact of the coronavirus pandemic, President Sebastián Piñera said on Thursday. The forecast, higher than the previous government estimate, also helped support the currency. Currency of the oil exporting nation Colombia lagged as oil prices dropped to $82 a barrel, extending sharp falls triggered by concerns over rising U.S. inflation while OPEC cut its 2021 oil demand forecast. Key Latin American stock indexes and currencies at 1433 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1280.18 0.45 MSCI LatAm 2217.70 1.75 Brazil Bovespa 108073.87 1.99 Mexico IPC - - Chile IPSA 4468.39 -0.46 Argentina MerVal 96081.83 1 Colombia COLCAP 1378.58 0.95 Currencies Latest Daily % change Brazil real 5.4268 1.38 Mexico peso 20.4921 0.63 Chile peso 790 0.58 Colombia peso 3876.53 -0.04 Peru sol 4.0193 -0.11 Argentina peso 100.1600 -0.01 (interbank) (Reporting by Shashank Nayar and Susan Mathew in Bengaluru; Editing by Andrea Ricci)