- Lula da Silva won the run-off on 25 October with 51.76 % of the valid votes, against 48.24 % for Flávio Bolsonaro.
- Polls had Bolsonaro ahead: São Paulo’s stock market and the real fell sharply in the following sessions.
- Brazil is one of the main destinations for Spanish investment in Latin America; a weaker real shows up in the accounts of companies doing business there.
Luiz Inácio Lula da Silva won the run-off of Brazil’s presidential election on Sunday 25 October 2026. With 99.77 % of polling sections counted, the Superior Electoral Court gave him 51.76 % of the valid votes, against 48.24 % for Flávio Bolsonaro, a lead of about 4.35 million votes. It will be his fourth term at the head of the country.
The result reversed the first round, in which Bolsonaro had come out ahead, and the latest polls: Datafolha’s final survey gave him 51 % against 49 % for Lula, within the margin of error. That surprise explains much of the market reaction.
How the markets reacted
In the sessions after the vote, São Paulo’s stock market and the Brazilian real fell very sharply. The figures vary depending on when they were measured: different media put the fall in the Bovespa index at between 14 % and 17 %, and that of the real against the dollar at between 7 % and 10 %.
Markets had considered a Bolsonaro victory likely, and the reaction mainly reflects uncertainty about fiscal policy in the new term and the path of Brazil’s public debt. Moves of this size within a few days are unusual; on their own they do not foretell what will happen in the coming months, but they show how sensitive emerging economies are to an unexpected political change.
Why it matters in Spain
Brazil is one of the main destinations for Spanish business investment in Latin America. Large Spanish banking, telecoms and energy groups have some of their most important subsidiaries there, and many mid-sized companies export to the country or have a commercial presence in it.
When the real depreciates, the profits those subsidiaries earn in reais are worth fewer euros when converted, even if the local business has not changed. For Spanish exporters, a weaker real makes their products more expensive for Brazilian customers; for those who buy in Brazil, as with many agricultural commodities, the effect is the opposite.
What remains to be seen
Lula will take office at the beginning of 2027. His programme and the make-up of Congress, where he will need support to pass his budgets, will shape economic policy for the coming years. The relationship with Europe also involves the trade agreement between the European Union and Mercosur, whose signature the EU Council authorised in January 2026.
For companies with customers, suppliers or subsidiaries in Brazil, the result is above all a reminder of how much the exchange rate weighs on their accounts. How to manage it, through currency hedging or payment and collection terms, depends on each business and is for each company to decide with its advisers. This information is of a general nature.
An unexpected vote can move a currency within hours.
This article is general information. It is not legal, tax or investment advice, and it does not take anyone’s particular circumstances into account.
