Corrects typo in the last name of US Trade Representative in paragraph 12

By Twesha Dikshit

March 17 (Reuters) - Latin American stocks and currencies climbed on Tuesday, as markets awaited interest rate decisions in Brazil and the U.S., while continuing to monitor developments in the Middle East conflict that sent oil prices soaring and revived inflation concerns.

Israel said it had killed Iran's security chief, while a senior Iranian official said the new supreme leader had rejected de-escalation offers, demanding that Israel and the U.S. be "brought to their knees."

With the Middle East war in its third week and no end in sight, the Strait of Hormuz remains largely closed, adding to rising energy prices and inflation concerns.

Oil prices were up more than 2% after paring earlier gains, with Iran's attacks on energy infrastructure in the region adding to worries over supplies.

Within EM, Latam remained less vulnerable to the war, with analysts pointing to the region's distance from the conflict zone and its oil-exporting economies that provide some security compared to Asia and emerging Europe's reliance on energy imports.

MSCI's gauge of Latin American equities ..MILA00000PUS advanced 1.9%, while a similar gauge for currencies .MILA00000CUS rose 0.9%.

Several central bank meetings will be in the spotlight this week, including ones in Brazil and the United States, as investors look to see how policymakers navigate interest-rate decisions amid expectations of a rise in inflation due to the oil surge.

Macquarie analysts said Brazil's Copom might cut the target rate this week by 25 basis points or not cut at all, a change from their initial expectations of a 50 bps cut.

"We still expect that some easing will take place in H1 2026 and H2 2026. That's because the administration of President Luiz Inacio "Lula" da Silva has moved proactively to limit the domestic fuel price pass-through, as it remains wary of the inflationary and political consequences of higher motor fuel prices," they said in a note.

STOCKS HIGHER ACROSS THE BOARD

Brazil's benchmark index .BVSP gained 1.2%, while the real BRL= firmed 0.6% against the greenback. The central bank's interest rate decision this week will take place with two empty seats on its committee, people familiar with the matter said, due to tensions between the government and Senate leaders.

Other oil-exporting countries also rose, with indexes in Colombia .COLCAP and Mexico .MXX adding 0.9% and 0.8%, respectively.

Mexican economy minister Marcelo Ebrard will meet U.S. Trade Representative Jamieson Greer on Wednesday to formally start the United States-Mexico-Canada (USMCA) trade deal review, Ebrard's office said.

Argentina's blue-chip index .MERV rose 1.2%, while Chile's .SPIPSA edged higher. Currencies in the region were between flat and higher with the Peruvian sol PEN= and Chilean peso CLP= strengthening 0.4% each.

Meanwhile, Russia said it had unwavering solidarity with Cuba after comments from U.S. President Donald Trump saying he expected to have the honour of "taking Cuba."

Elsewhere in EM, bourses in Hungary .BUX, Poland .WIG20 and Turkey .XU100 added about 2% each. Asian markets were lifted on AI-driven optimism with indexes in Korea .KS11 and Taiwan .TWII closing up around 1.5% each.

Key Latin American stock indexes and currencies at 14:36 GMT:

(Reporting by Twesha Dikshit, Editing by Louise Heavens)

((Twesha.Dikshit@thomsonreuters.com;))