EMERGING MARKETS-Latam currencies rally as dollar pauses after stellar run

* Lula's lead narrows to single-digit in Brazil race - poll * Chile consumer prices up 1.4% in July * Colombia's new leftist govt proposes tax reform bill (Updates prices; adds comment, details) By Susan Mathew and Anisha Sircar Aug 8 (Reuters) - Latin American currencies jumped on Monday as the dollar gave back some of its recent gains, with Chile's peso leading the rally on support from higher prices of its key export, copper. The dollar eased to 106.23 following a 10-day high of 106.93 on Friday. Strong U.S. jobs data had taken bets of a 75 basis points hike by the Federal Reserve in September to 70%, fuelling flows into the dollar last week. Chile's peso jumped 1.3%, tracking stronger copper prices, which were boosted by rising imports by China. The world's top copper producer saw exports of the red metal reach $3.42 billion in July, down 25% from a year earlier, Chile's central bank said. Inflation in the Andean country, meanwhile, rose to 1.4% in July, accelerating from 0.9% in the previous month and ahead of an expected 1.15% rise in a Reuters poll. Brazil's real jumped 1%. Former President Luiz Inacio Lula da Silva's lead over incumbent Jair Bolsonaro has narrowed to 7 percentage points ahead of the October election, according to a new poll. "Bolsonaro’s poll numbers could continue to improve in the coming weeks because of lower fuel prices, improvements in the job market and larger social benefits, but we don't expect significant shifts in the polls until campaigning begins in earnest next month," said Elizabeth Johnson and Wilson Ferrarezi, economists at TS Lombard. "Bolsonaro is finally seeing some positive tailwinds, but he will still face significant challenges to be re-elected... Meanwhile, the Lula campaign will continue to focus on persuading supporters of third-party candidates to cast a tactical vote for him in the first round." Mexico's peso was up 0.8%. Inflation data due on Tuesday will precede an interest rate decision by the country's central bank later in the week. Analysts project annual inflation will hit 8.13% in July, a level not seen since December 2000, fueling bets the bank will continue hiking its key rate through the rest of the year. On Thursday, Banxico, as the bank is known, is seen hiking by 75 bps to 8.50%, as per Refinitiv. High borrowing costs in the United States have previously spurred currency crises in emerging markets, but analysts say central banks in the developing world may be more prepared this time round. Despite broader inflationary and geopolitical pressures, Latam's currencies index is up more than 11% on the year, while the stocks index has gained about 3%. Colombia's peso rose 0.7%. The country's new leftist government proposed a tax reform bill to lawmakers which would raise some 25 trillion pesos ($5.76 billion) in 2023 to increase revenue for anti-poverty programs. Key Latin American stock indexes and currencies at 1915 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1002.13 -0.07 MSCI LatAm 2203.36 2.74 Brazil Bovespa 108245.15 1.67 Mexico IPC 47086.77 0.78 Chile IPSA 5244.20 0.61 Argentina MerVal 123568.76 2.12 Colombia COLCAP 1320.40 1.56 Currencies Latest Daily % change Brazil real 5.1126 1.05 Mexico peso 20.2608 0.75 Chile peso 905.3 1.35 Colombia peso 4306.96 0.67 Peru sol 3.9142 -0.45 Argentina peso 133.5600 -0.48 (interbank) Argentina peso 287 2.09 (parallel) (Reporting by Susan Mathew and Anisha Sircar in Bengaluru; editing by Barbara Lewis and Marguerita Choy)