EMERGING MARKETS-Latam stocks, currencies subdued; Mexican budget in focus

Updated at 1538 GMT

By Johann M Cherian

Nov 15 (Reuters) - Most Latin American currencies and stocks were subdued on Friday as investors weighed the implications of recent U.S. political developments for the region, while Mexico's government budget presentation was expected later in the day.

Mexico's peso MXN= dipped 0.1% against the dollar, a day after Banxico reduced borrowing costs by 25 basis points and left the door open for additional cuts.

"We expect the (central bank) to deliver another 25 bps rate cut at the December meeting, and in our assessment the bar to accelerate the pace of cuts to 50 bps is relatively high given prevailing domestic and external uncertainty, in particular around a number of issues in the U.S.-Mexico bilateral agenda," Goldman Sachs analysts said in a note.

Top on the radar was the presentation of a government budget with traders looking for measures taken to narrow the country's large fiscal deficit and solutions to reduce debt on state oil firm Pemex's books.

President Claudia Sheinbaum said the government has room to boost tax revenues without any fiscal overhaul. However, late on Thursday, ratings agency Moody's downgraded the country's outlook to negative, citing a widening fiscal deficit and recent controversial judicial reforms.

The peso has depreciated over 17% this year as markets priced in institutional risks in the government and that Donald Trump's policies against Mexico could weigh on the economy.

More broadly, MSCI's index tracking currencies in Latin America .MILA00000CUS was little changed and was on track for modest declines for the week. The U.S. dollar was hovering near a one-year high and was on track for its biggest weekly jump in over a month.

Peru's sol PEN= dipped 0.3%. Investors kept an eye on the Asia-Pacific Economic Cooperation summit. Chinese President Xi Jinping who was present at the summit, inaugurated a port that Beijing had invested in.

Copper exporter Chile's peso CLP= dipped 0.2%, while Colombia's peso COP= crept up 0.4%.

On the equities side, MSCI's index tracking Latam stocks .MILA00000PUS slipped 0.2%, although Mexican equities climbed 0.5%.

Colombia's COLCAP index .COLCAP was flat, while Argentina's Merval index .MERV rose 1.5%.

Chile's bourse .SPIPSA was muted, while Peruvian equities .SPBLPGPT added 0.4%.

Elsewhere, El Salvador issued $1 billion worth of six-year bonds at a yield of 12%. The country's hard-currency bond USP01012CF16= maturing in 2030 jumped in early trading.

Markets in Brazil were shut for a public holiday ahead of a Group of 20 top economies summit next week.

Key Latin American stock indexes and currencies:

(Reporting by Johann M Cherian in Bengaluru)

((johann.mcherian@thomsonreuters.com;))