Brazil’s real retained most of its first-round election gain by Oct. 19, leaving the Oct. 25 presidential runoff as the next test for the currency.
Banco Central do Brasil’s daily PTAX reference put the U.S. dollar at 5.0561 reais on Oct. 19. It had stood at 5.2235 reais on Oct. 2, before the vote, and dropped to 4.9856 reais on Oct. 5. The latest reading shows that the real had surrendered some of its initial gain but remained stronger than before the first round: fewer reais were needed to buy $1 than on Oct. 2.
The Tribunal Superior Eleitoral (TSE) reported that Sen. Flávio Bolsonaro received 56,104,268 votes, or 47.03% of valid ballots, while President Luiz Inácio Lula da Silva received 53,876,617, or 45.16%. Those figures reflected a count of 99.99% of ballot boxes. Neither candidate won a majority.
The central bank compiles PTAX after consulting currency dealers four times each day. The figures are daily reference rates, rather than live spot prices.
In analysis excerpted by FXStreet, Commerzbank analyst Norman Liebke said the real may strengthen briefly if Bolsonaro wins. Liebke said congressional opposition could limit Bolsonaro’s ability to enact fiscal measures and potentially reverse a rally.
The TSE has scheduled the runoff between Bolsonaro and Lula for Oct. 25.
