* Mexico's peso adds 0.6 pct as U.S. stocks gain
* Brazil's real rises for 8th straight day, cenbank eyed
* Real outperforms major currencies over week on Petrobras (Recasts, updates prices)
By Samantha Pearson and Jean Luis Arce
SAO PAULO/MEXICO CITY, Sept 10 (Reuters) - The Brazilian real closed on Friday at its strongest level against the U.S. dollar this year as investors defied attempts by the central bank to halt the currency's rally and protect exporters.
Most of Latin America's other currencies also firmed, following strong economic data from China, one of the region's top trading partners.
China's imports leaped in August, indicating high demand for raw materials from Latin America, Brazil in particular. For details, see: [ID:nTOE689024]
The Brazilian real
A massive fund-raising deal by state-owned oil company Petrobras, which is expected to lure between $15 billion and $25 billion of foreign investment, along with the prospect of other deals, has also boosted the currency in recent weeks.
Over the week, it has gained 0.64 percent. Meanwhile, the Mexican peso has barely budged and the Chilean peso has weakened 0.1 percent.
"It's a dramatic situation," said Joao Medeiros, a partner at Pioneer Corretora, one of Brazil's biggest currency brokerages.
The real's rally has put huge pressure on exporters, prompting the central bank to start calling multiple auctions to buy U.S. dollars on the spot market.
"But this is not resolving the situation. The bank is just transforming the currency, which had a floating exchange rate, into a dirty float," Medeiros said.
"The central bank has a series of instruments that it can use. But their effects are extremely short-lived and it puts Brazil in a difficult situation abroad. The rules of the game are constantly changing and this doesn't do anyone any good."
Analysts believe it will be difficult to contain the currency's rally as foreign investment continues to pour in. [ID:nN10251620]
The Mexican currency
The peso also tracked gains on the U.S. stock markets, which investors use as a proxy for interest in Mexico's assets on a day when economic data is scarce.
"In general, we saw some good data this week and this has continued to stabilize the outlook for the U.S. economy, which is the most important thing," said Ramses Villela, head of currency trading at Bulltick Capital Markets in Mexico City.
Colombia and Peru's currencies also firmed in line with
global markets. But the Chilean peso
"This type of market is like a swamp, with very limited sideways moves," said one trader in Santiago. "The market is very cautious because there is a lot of uncertainty over the future movements of the dollar."
This uncertainty has caused volumes to dwindle over recent sessions, he noted.
Chile's economy is seen surging 6.7 percent in August from a year earlier and expanding 5.3 percent for all of 2010, a central bank poll of financial analysts showed on Friday. [ID:nN10249284]
A devastating earthquake in February hit the country's economy hard but growth has rebounded much more quickly than expected, prompting investors to bet on higher interest rates in the months ahead. (Additional reporting by Froilan Romero in Santiago; Editing by Dan Grebler)