EMERGING MARKETS-Latam markets weaken ahead of Fed; Colombian peso up after regional election results

* Engie Brasil buys solar farms from GIP in $646 mln deal * Colombian peso strengthens after results of regional elections * Latam equities dip 0.5%, FX off 0.6% By Johann M Cherian Oct 30 (Reuters) - Sentiment was mostly upbeat across Latin America on Monday, with Colombia's peso jumping to its highest in over a month following regional election results, while investors also awaited interest rate decisions by central banks later in the week. Colombia's peso spiked as much as 1.7% after opposition candidates largely swept elections for mayors, governors and regional lawmakers on Sunday, dealing a defeat to President Gustavo Petro's leftist coalition in votes that analysts called a referendum on his government. The local benchmark index, Colcap rose 0.5%. "These results are likely to be perceived as a political setback for President Petro, lessening the administration's political capital required to advance its agenda," Goldman Sachs analysts wrote in a note. "Given that the reforms remain generally unpopular, we believe that these results are likely to budge the needle for some ambivalent lawmakers to oppose the government bills more forcefully." Separately, investors also await a local interest rate decision, later in the week where economists expect the regulator to leave borrowing costs unchanged at 13.25%. The peso is among the best regional performers so far this year, up 19.7%, benefiting also from high oil prices. However, MSCI's basket of regional currencies weakened 0.6% against the dollar ahead of a highly anticipated monetary policy decision by the U.S. Federal Reserve on Wednesday, where the regulator is expected to leave interest rates unchanged. The verdict could determine the outlook for the dollar and consequently emerging markets currencies like those in South America. Iron ore exporter Brazil's real rose 0.2% as the raw material's prices got a boost, while oil exporter Mexico's peso added 0.6%. Bucking the trend, the Chilean peso weakened 0.7% in the first business day after the local central bank's decision to suspend its reserve accumulation plan and cut the reference interest rate to less than the expected. The other regional copper producer Peru's sol advanced 0.4% as prices of the red metal gained from hopes of an improving outlook from top consumer China. Meanwhile, local equity indexes slipped 0.5%, with Chile's benchmark index falling 1.5%, while Mexico's benchmark index added 0.8% by 1431 GMT. Brazil's benchmark Bovespa added 0.4% boosted by a 1.8% gain in mining giant Vale. Among single movers, Engie Brasil Energia slipped 0.2% after the power company said it has agreed to buy a series of photovoltaic power stations in Brazil owned by Atlas Energia from investment fund Global Infrastructure Partners (GIP). Elsewhere in emerging markets, Pakistan's rupee was flat after the central bank kept its key interest rate unchanged, as expected, and forecast inflation would ease in the months ahead after a sharp jump last month. Key Latin American stock indexes and currencies at 1431 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 923.28 0.38 MSCI LatAm 2210.44 -0.48 Brazil Bovespa 113812.15 0.45 Mexico IPC 49363.41 0.8 Chile IPSA 5498.98 -1.25 Argentina MerVal 649123.68 -0.983 Colombia COLCAP 1099.47 0.51 Currencies Latest Daily % change Brazil real 5.0055 0.13 Mexico peso 18.0150 0.54 Chile peso 913 2.22 Colombia peso 4069.01 0.70 Peru sol 3.8368 0.18 Argentina peso (interbank) 350.0000 0.01 Argentina peso (parallel) 960 2.08 (Reporting by Johann M Cherian in Bengaluru Editing by Alistair Bell)