FX.co ★ Ibovespa Rises Following Election Polls and US Inflation

The Ibovespa climbed about 1% on Wednesday to trade near 185,500 points, supported by a tighter presidential race in new polls and softer-than-expected US PCE inflation. Surveys by Meio/Ideia and Indexa/Broadcast indicated President Lula and Flávio Bolsonaro are effectively tied in a likely second-round runoff, with the Meio/Ideia poll showing a gap of just 0.5 percentage point between the two candidates.

Abroad, US PCE inflation came in slightly below forecasts, easing some concern over additional interest rate hikes by the Federal Reserve. Domestically, however, Brazil’s PPI accelerated, rising 2.5% year over year in August after a 1.9% increase in July.

In the equity market, major banks advanced: Itaú gained more than 1%, while Bradesco and Banco do Brasil added over 1.5% each. Utilities also moved higher, with Sabesp up around 2%. Petrobras climbed more than 1% as the oil rally resumed, and Vale recovered nearly 1% from Tuesday’s pullback, tracking higher iron ore prices in China.