(For a Reuters live blog on U.S., UK and European stock markets, click or type LIVE/ in a news window.) * Brazil's Suzano readies $15 bln bid for International Paper * Chile central bank says economy recovering but some sectors lag * Brazil's Itau may pay extra dividend this year, says CEO * Stocks up 0.2%, FX off 0.1% (Updated at 1931 GMT) By Shashwat Chauhan and Johann M Cherian May 7 (Reuters) - Most Latin American currencies and stocks were little changed on Tuesday, as investors stepped to the sidelines on caution ahead of a slew of central bank rate decisions and economic data out of the region. MSCI's gauge for Latin American stocks inched up 0.2%, while the currencies index dipped 0.1% against the dollar, ending a three-day winning streak, by 1931 GMT. As the largest economy in the region, Brazil will be the focus on Wednesday, as its central bank is widely expected to cut interest rates by at least 25 basis points. The real was largely flat. Mexico's peso slipped 0.2%, with Banxico seen holding rates at 11% at its policy meeting later in the week. Investors will also keep a close watch on April inflation readings out of the region's second-largest economy. "Services sector inflation is still relatively high in Mexico and it looks like it may be trending a bit higher," said Brendan McKenna, international economist and FX strategist at Wells Fargo Securities. "It will take a little bit longer for Mexico to ultimately deliver consistent interest rate cuts ... it wouldn't be surprising to see a pause in easing cycle this week." Among currencies of major economies in the region, oil exporter Mexico's peso has held on to gains, so far into the year benefiting also from higher oil prices and the impact of near-shoring activity. Among others, Chile's peso declined 0.7%. The local central bank said that the copper producer's economy is broadly recovering, though some sectors have lagged and financial market depth has not yet returned to levels seen before the pandemic. On the equities front, Brazil's Bovespa stock index added 0.5%, briefly touching a four-week high. Itau Unibanco jumped nearly 2% after Chief Executive Milton Maluhy Filho said the lender has been working with some excess of capital and will "calibrate" it toward the end of the year to potentially pay extra dividends. Embraer slipped over 2% after the plane maker reaffirmed its full-year outlook and rebuffed speculation that it plans to develop a new jet. Rede D'Or jumped almost 9.3% after the Brazilian health group recorded a 165.2% jump in first-quarter net profit, beating market expectations. Suzano tumbled 12.5% after Reuters reported that the Brazilian pulp and paper company approached U.S.-based International Paper to express interest in an all-cash acquisition that would be worth almost $15 billion. Among other major movers, Chile's main index added 1.2%, while Argentina's MerVal index shed 2.4%. Key Latin American stock indexes and currencies at 1931 GMT: Latin American market prices from Reuters Stock indexes Latest Daily % change MSCI Emerging Markets 1067.62 0.08 MSCI LatAm 2502.54 0.22 Brazil Bovespa 129139.89 0.52 Mexico IPC 57121.42 -0.28 Chile IPSA 6580.04 1.28 Argentina MerVal 1460367.68 -2.371 Colombia COLCAP 1385.02 0.37 Currencies Latest Daily % change Brazil real 5.0687 0.10 Mexico peso 16.8991 -0.23 Chile peso 936.3 -0.69 Colombia peso 3889.33 0.09 Peru sol 3.7123 0.09 Argentina peso 880.5000 0.00 (interbank) Argentina peso 1020 2.45 (parallel) (Reporting by Shashwat Chauhan and Johann M Cherian in Bengaluru Editing by Kirsten Donovan and Matthew Lewis)