The number of the week is 4.64%: that is how much Brazil's dollar futures contract, which reflects the market's bet on the exchange rate, fell between Monday and Friday. In practical terms, anyone planning a trip abroad or waiting for a deal on imported electronics got some relief: a US$ 500 item that would have cost R$ 2,609 on the eve of the election was going for about R$ 2,501 by the end of the week.
The stock market moved the other way, and hard. The Ibovespa, the main index of the B3 exchange in São Paulo, rose 8.82% in the week and closed Friday (9) at 209,066 points, after setting a new all-time high of 209,713 points, according to an analysis by Rodrigo Paz published by InfoMoney. Someone with R$ 10,000 in a fund tracking the index saw it turn into roughly R$ 10,880 in five trading sessions.
The trigger was the first round of the presidential election, held on Sunday (4). With Senator Flávio Bolsonaro (PL) finishing ahead of President Lula (PT), investors cut the risk premium they charge to put money into Brazil, Agência Brasil reported. On Monday (5), the first session after the vote, the spot dollar plunged 4.12% to R$ 5.0022, its lowest close since May, and the Ibovespa jumped 7.85% on turnover of R$ 97.58 billion.
Understand the mechanism: a risk premium is the extra return investors demand to hold assets of a country they see as unstable. When that premium shrinks, the real gains value, future interest rates fall and stocks rise. The move showed up abroad as well: EWZ, the main Brazilian stock fund traded in New York, climbed 12.57% on Monday.
The rally has already reshaped forecasts at major banks. Goldman Sachs abandoned its scenario of a dollar above R$ 5, Valor Econômico reported. Earlier this month, the U.S. bank estimated the currency could trade between R$ 4.50 and R$ 5.80 after the election, depending on the next government's fiscal policy, according to Bloomberg Línea.
Will the euphoria last?
Not everyone sees room for the rally to continue at this pace. In the InfoMoney analysis, the Ibovespa has entered overbought territory: the RSI (Relative Strength Index, a gauge of the speed of gains) hit 80.30 points, above the 70 level that usually precedes pauses or corrections. Paz sees a chance of profit-taking before new highs and is watching supports at 203,984 and 199,354 points, ranges where the index tends to attract buyers again.
In the currency market, dollar futures ended the week at 5,013 points, testing the psychological 5,000 range, while the spot rate hovers around R$ 5. The U.S. currency is down 8.87% against the real in 2026, according to Agência Brasil. The market's next test is the runoff, scheduled for October 25, and the detailing of the two candidates' fiscal promises.