Brazil’s real sinks after Lula’s re-election victory

Investors react to Lula’s election victory with a sharp decline in the Brazilian real and concerns over increased spending and fiscal challenges.Published On 26 Oct 202626 Oct 2026Brazil’s real dropped against the United States dollar on the heels of Brazil’s President Luiz Inacio Lula da Silva’s unexpected re-election after right-wing Flavio Bolsonaro, the son of former President Jair Bolsonaro, led in the first round of voting earlier this month.Brazil’s currency dropped against the dollar by 12 percent in spot trading. Bovespa stock index futures tumbled nearly 15 percent on Monday.Recommended Stories list of 3 itemslist 1 of 3World reacts to Lula’s victory in Brazil’s presidential electionlist 2 of 3Lula’s victory may be a turning point for Latin Americalist 3 of 3How did Lula beat Bolsonaro after losing Brazil’s first-round election?end of list“I’m not surprised the real is sinking sharply; traders are covering their bets that assume a Bolsonaro victory and tighter fiscal policy,” Rachel Ziemba, adjunct senior fellow at the Center for a New American Security, told Al Jazeera.Brazil’s stock exchange halted trading for 30 minutes. The Bovespa index fell 10 percent from its previ...