One week before Brazil's presidential runoff, traders see Lula winning as unlikely

With one week until Brazil’s runoff, traders still see Luiz Inácio Lula da Silva winning as unlikely. A separate market continues to favor his opponent, Flávio Bolsonaro. Polls have tightened, but they have not changed the broader expectation that Flávio is more likely to win.

The race changed sharply after the first round on October 4. With nearly all polling stations counted, Brazil’s Superior Electoral Court reported Flávio at 47.03% of valid votes and Lula at 45.16%, sending the contest to a runoff. Lula’s market standing then fell steeply and stayed very low for several days. It began to recover around October 14, reaching a recent high on October 16–17, before easing back by Sunday. The latest dip has no confirmed explanation; the polling cited so far does not show Flávio’s lead widening again.

Recent surveys show a close contest. Datafolha’s October 15 poll put Flávio ahead 51% to 49% among valid votes, within its two-point margin of error. An Ipespe/Abrapel survey published October 17 found Flávio ahead 51.2% to 48.8%, also within its margin of error. Those results are tighter than the earlier Ipespe/Abrapel poll cited in the previous update, and help explain why Lula’s prospects improved from their post-first-round low. Still, the polls do not put him ahead.

The campaigns have a final debate scheduled for October 23, two days before the vote. Late campaign events, turnout and the official count could still shape the result. Brazil’s electoral court schedules voting for October 25, with ballot reports beginning after polls close. If reporting on the result is ambiguous, the court’s official results will determine the outcome.