US President Donald Trump renewed his criticism of the US Federal Reserve, tweeting the central bank was the "only problem" for the US economy.

Concerns about a prolonged US government shutdown softened the dollar and helped set the stage for general stability in Latin American currencies, which weathered cautious risk sentiment toward the region.

MSCI's benchmark tracking Latin American stocks declined half a percent to a two-week closing trough.

Mexico's main stocks index fell 0.2 percent but its peso firmed 0.4 percent, supported by news the country's congress approved the budget for 2019 presented by new President Andrés Manuel López Obrador's government.

However, there was little liquidity in trade in the currency of Latin America's second-largest economy, with Refinitiv Eikon data showing volumes were only about 20 percent of the average over the past week.

Colombia's peso was little changed but the country's stocks benchmark slid 1 percent to clock its lowest closing level in more than a year.

Oil firm Ecopetrol SA dropped 4.3 percent on Monday as global oil prices slid more than 6 percent on fears of an economic slowdown.

Ecopetrol's stock has sunk about 38.6 percent this quarter so far, following close on the heels of a more than 40 percent tumble in oil prices over the same period.

Chile's peso snapped a seven-session losing run, strengthening about half a percent, while the country's equities benchmark slid 0.6 percent.

Emerging markets have been pummeled in 2018, with rising US interest rates making dollar assets relatively more attractive than previously. That, combined with the bruising US-China trade war, has prodded capital into perceived safer harbors in the developed world.

However, the significant sell-off in emerging market assets has tempted some investors to return to probe cautiously for pockets of value.

"We view emerging markets as oversold and under-owned," said David Woo, head of global rates, FX and fixed income strategy and economics research at BofA Merrill Lynch, in the firm's outlook for 2019 earlier this month.

"However, we are waiting until the US-China trade war has been fully resolved before turning more constructive on emerging markets."

Financial markets in Brazil and Argentina were closed on Monday for Christmas Eve and Latin American markets will be closed on Tuesday for Christmas.