By Lisa Pauline Mattackal and Shashwat Chauhan

March 14 (Reuters) - Latin American stocks and currencies rose sharply on Friday, helped by gains in commodity prices and as investors took a breather from a barrage of U.S. tariff policy headlines.

MSCI's index for Latin American currencies .MILA00000CUS was up 1.1% by 1520 GMT at its highest since July, while the gauge of regional stocks .MILA00000PUS jumped 3.2%, set for its best day in three months.

"The postponement of U.S. tariffs until 2 April and favorable political dynamics are generating a constructive environment for LatAm FX," analysts at Societe Generale wrote, adding they were "constructive" on Latam currencies.

Wider interest rate differentials, recent declines in the U.S. dollar and disciplined monetary policy were adding to a more positive outlook for the region's currencies, they added.

The Mexican peso MXN=, among the most sensitive to U.S. tariffs, rose 1%. U.S. Secretary of State Marco Rubio said late Thursday that cooperation with Mexican authorities has improved, but work still needs to be done on curtailing the flow of illegal drugs.

The real BRBY= jumped 1.2% after data showed Brazil's debt to GDP ratio fell unexpectedly in January. However, January retail sales slipped for a third consecutive month in January.

Despite the signs of a slowdown, Brazil's central bank is expected to hike rates to a near decade high at its meeting next week to combat inflation.

Oil prices rose, and gold jumped past the $3,000 per ounce level for the first time, also aiding currencies and stocks. GOL/ O/R

Miner Vale VALE3.SA gained 3.3%, and Brazil's Petrobras PETR3.SA and Colombia's Ecopetrol ECO.CN rose 2.3% and 3%, respectively.

Argentina's Merval .MERV leapt 3.8%, while Brazil's Bovespa .BVSP was up 2.2%.

Still, both broader Latam indexes were set for slight weekly declines - the stocks index for a 0.6% loss and currencies for a 0.1% dip - as markets have been hit by an escalating global tariff war and concerns about slowing U.S. and global growth.

Despite volatility, the Latin American stocks index has gained nearly 13% this year, sharply outperforming the U.S. benchmark index .SPX which has lost 4.4%.

Peru's sol PEN=PE rose 0.3% after the central bank on Thursday held its benchmark interest rate at 4.75%, as expected.

Elsewhere, Trump said there is a "very good chance" the war between Russia and Ukraine can end after "productive" discussions with Russian President Vladimir Putin.

That optimism helped lift stocks in Central and Eastern Europe, which were further boosted after German political parties reached an agreement on a key debt deal.

Prices of Ukraine dollar bonds rose.

Argentina inflation data was due later in the day.

HIGHLIGHTS

** Donald Trump makes Chinese stocks (somewhat) great again

** Amid tariff risks, Vietnam signs energy deals with US, reviews duties to boost US imports

Key Latin American stock indexes and currencies at 1520 GMT:

(Reporting by Lisa Mattackal and Shashwat Chauhan in Bengaluru; Editing by Susan Fenton)

((LisaPauline.Mattackal@thomsonreuters.com;))