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EMERGING MARKETS-Latam assets slide as U.S.-China trade war froths

(Recasts throughout, updates prices, adds market strategist's quote) By Aaron Saldanha May 13 (Reuters) - Latin American currencies softened against the dollar on Monday, with global risk appetite hammered by rising U.S.-China trade tensions, which prompted some investors in Latin American stocks to cash out their chips in a rush.

China plans to impose higher tariffs on $60 billion worth of U.S. goods it would target, the latest salvo in the top two economies' trade war.

The yuan hit its lowest level against the dollar since December, setting a broadly negative tone for emerging markets currencies against the greenback.

MSCI's index of Latin American currencies dipped 0.5%, while its Latin American stocks index dived 2.6% to a 5-1/2-month low.

Mexico's peso softened 0.7%, the smallest decline among its regional peers. Stocks slid 0.6%.

Banco de Mexico (Banxico) meets later this week and many market participants expect rates to remain at 8.25%.

"If you are holder of Cetes (Mexican Treasury certificates), you're locking in really good interest rates and then there's the prospect for them (Banxico) to ease maybe over the summer," said Marc C. Chandler, chief market strategist at Bannockburn Global Forex.

"It's a really interesting play and I think it's a cash register for a lot of hedge funds and I think they are reluctant to give it up. For me, even if the peso weakens up to 19.50, at that price there will still be buyers." Brazil's real weakened 0.8%, while stocks on the Bovespa dropped 2.7% on broad-based losses.

Against a backdrop of lower oil prices, common shares and preferred shares of state-run oil firm Petroleo Brasileiro SA (Petrobras) slid 2.9% each.

Petrobras is not planning on selling any refining assets beyond the refineries it has already publicly slated for divestment, an executive wrote to employees last week.

Iron ore mining giant Vale SA shed 4.1%. China is an important market for the firm's exports of the steel making ingredient.

Petrochemical producer Braskem SA dived 7%. The New York Stock Exchange will start a delisting process for Braskem's U.S.-listed shares, the firm said, after it failed to file its 2017 annual report on time.

Chile's peso fell 1.1%, following lower prices of Chile's top export, copper. China is the world's top importer of the metal.

Argentina's stocks benchmark tumbled 3.3%, while the peso softened as investors shirked riskier positions.

Latin American stock indexes and currencies at 2049 GMT Stock indexes daily % Latest change MSCI Emerging Markets 1016.49 -1.64 MSCI LatAm 2586.16 -2.64 Brazil Bovespa 91726.54 -2.69 Mexico IPC 43142.46 -0.55 Chile IPSA 4969.82 -1.6 Argentina MerVal 32300.25 -3.27 Colombia IGBC 12363.24 -2.36 Currencies daily % change Latest Brazil real 3.9990 -0.54 Mexico peso 19.2340 -0.72 Chile peso 693.4 -1.14 Colombia peso 3302.98 -0.93 Peru sol 3.327 -0.36 Argentina peso (interbank) 45.0900 -0.42 (Reporting by Aaron Saldanha in Bengaluru; editing by Grant McCool)