Brazil’s real tumbled more than 12.5% to 5.60 per dollar, its weakest level since late May 2025, after left-wing President Luiz Inacio Lula da Silva unexpectedly defeated right-wing Senator Flavio Bolsonaro in a historic runoff to secure re-election. Bolsonaro, son of jailed former president Jair Bolsonaro, had been favored to win after narrowly leading the first round on October 4, campaigning on tighter fiscal policy and lower corporate taxes. Lula ultimately won 51.8% of the vote against Bolsonaro’s 48.2%, following a bitterly contested campaign marked by street demonstrations and an intensive social media push. Despite his victory, Lula faces his toughest political landscape since first taking office in 2003, with a deeply polarized electorate and the most right-wing Congress in Brazil’s democratic era. Meanwhile, Bolsonaro has reportedly refused to concede and is challenging the results in court, although the Superior Electoral Court has confirmed the outcome.