Mexico stocks edge up; bonds hold at 4-month low

MEXICO CITY, May 15 (Reuters) - Mexican stocks edged up on Thursday, led by gains in shares of copper miner Grupo Mexico as prices for the red metal rose, while bond prices held steady at four-month lows due to mounting inflation fears.

The benchmark IPC stock index .MXX edged up 0.21 percent to 31,402 points, while the peso <MXN=> MEX01 weakened a marginal 0.03 percent to 10.483 per dollar.

The government's benchmark 10-year peso bond <MX10YT=RR> was flat with a price of 97.665 and a yield of 8.10 percent, the highest since Jan. 11.

Bond investors fear accelerating inflation could push the central bank to raise interest rates this year. The yield on the 10-year bond has risen by around 60 basis points since early April.

Worries were further stoked after producers of corn flour tortillas on Wednesday said they will soon raise prices for the Mexican staple.

Bananmex, the Mexican unit of Citigroup, said in a research note that media reports suggesting tortilla prices could rise as much as 40 percent were "excessive."

The bank said it expected to see 10 percent to 17 percent price increases, which would amount to an additional 13 basis points on the inflation index.

In stock trading, shares of miner Grupo Mexico (GMEXICOB.MX: Quote, Profile, Research), one of the world's largest copper producers, gained 1.89 percent to 78.25 pesos as copper prices rose around 2 percent. (Reporting by Michael O'Boyle and Vanessa Padilla; Editing by Jonathan Oatis)