EMERGING MARKETS-Latam stocks rise, but breakout higher unlikely

* Thin volumes underscore investors' lack of conviction

* Brazil's Bovespa adds 0.34 pct, Mexico's IPC 0.08 pct (Updates to close)

By Luciana Lopez

SAO PAULO, March 29 (Reuters) - Latin American stocks rose on Tuesday, but low volumes, uncertainty about rising inflation across the region and a cloudy global outlook suggest stocks could continue their bumpy ride within a narrow range.

Brazil's benchmark Bovespa index <.BVSP> rose 0.34 percent to 67,481.76, failing to break past the 68,000 level that has been a barrier since the beginning of February.

"For the Bovespa to break that upper level, we need to have the inflation rate fall," said Adriano Fontes, who helps manage $190 million in assets with Oren Investimentos in Rio de Janeiro.

Economists sharply raised their forecast for Brazilian inflation to 6 percent this year, according to a weekly central bank poll issued on Monday. [ID:nN28168680]

Data showed lending in Brazil's banking system sped up in February despite government measures to cool credit, which could bode for tighter monetary policy. [ID:nN29270469]

Since early this year, global investors have been pulling funds out of emerging markets, where inflation pressures are leading to higher borrowing costs.

Since the end of January, the Bovespa has found support at 65,500 and resistance at 68,250, said Daniel Marques, an equity analyst with Agora.

"The market just isn't budging," he said. "And the volume is ridiculous."

Uncertainty abroad -- following natural and nuclear disasters in Japan and revolts in the Middle East -- have kept investors leery, Marques said. "It's been awhile since we've had good news."

In Brazil, shares of mining company Vale rose 1.85 percent. The stock has been hemmed in by its 20-day simple moving average since early February, after the stock began to slump in January.

Vale shares have been plagued by uncertainty on the fate of the company's chief executive, Roger Agnelli, who has a famously tense relationship with the government.

The broader MSCI Latin American stocks index <.MILA00000PUS> gained 0.3 percent to 4,485.24 points, pulling back from a session high.

The index has bounced in a narrow range without a clear tendency since October, trading between a key support near 4,300 points and a strong resistance around 4,700.

Mexico's IPC index <.MXX> edged up 0.08 percent to 36,795.89 points. Mexican stocks have been on a downtrend since falling off a record high in January.

A strong rebound last week on decent volume has been followed by lackluster trading this week.

Analysts said strong U.S. labor data could help push stocks higher, but a break on good volume through the 37,000 level would be needed to suggest further gains.

Broadcaster Televisa rose 1.59 percent while auto parts, petrochemical and cold meats conglomerate Alfa fell 1.81 percent.

Chile's IPSA index <.IPSA> fell 0.77 percent, pulling back further from a close last week at its highest since mid-February.

Retailers, which led a recent charge higher, were hit by profit-taking. Cencosud lost 1.87 percent.

The Luksic group's investment vehicle Quinenco rose 1.22 percent after local media reported that a subsidiary would more than double its stake in French cable manufacturer Nexans to 20 percent. (Additional reporting by Brad Haynes in Santiago, writing by Michael O'Boyle in Mexico City; Editing by Dan Grebler)