UDPATE 1-Mexico seen holding key interest rate steady

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MEXICO CITY, May 15 (Reuters) - Mexico's central bank is expected to keep interest rates steady on Friday, but analysts said concerns about inflation could pave the way for a rate hike later in the year.

All of the 24 economists and analysts surveyed by Reuters on Thursday predicted the central bank will keep its key overnight interest rate steady at 7.50 percent at its monthly review at 9 a.m. (1500 GMT) on Friday.

But spiraling world food prices recently pushed Mexico's inflation rate to a three-year high, leading investors to bet the central bank is more worried about price increases than the forecast effects of the U.S. economic slowdown.

"I think they will say inflation is their biggest worry," said J.P Morgan's senior Latin America economist Alfredo Thorne.

"The market is clearly very worried (about inflation) right now and sees a rate hike before the year ends," he said.

Interest rate futures <0#TII:> show investors are betting there is a high probability that the central bank will raise interest rates by 25 basis points later this year.

Inflation across Latin America has jumped in recent months as rapidly developing economies like India and China boost demand for food commodities and as grains are diverted to make biofuels. (Reporting by Jason Lange and Lizbeth Salazar; Editing by Jonathan Oatis)