Skip to contentHome page Seeking Alpha - Power to InvestorsNov 01, 2026, 10:24 PM ETEWZ, BRF, EWZS, FLBR, BRZU, BZQOtaviano Canuto549 FollowersBrazilian assets suffered a sharp selloff post-election, with the real down 8.21% and Ibovespa falling 18.4%, reflecting fiscal and political uncertainty.Investor concerns center on Brazil's rising public debt, projected to reach nearly 83% of GDP by 2026, and persistent primary deficits.A credible, gradual fiscal adjustment—rather than denial or drastic austerity—is positioned as the only viable path to stabilize markets and sovereign risk.Lula’s administration must signal a genuine commitment to fiscal reform to avoid a crisis or 'hard landing,' echoing his successful first-term approach.Samy St Clair/iStock Editorial via Getty ImagesA week of shock for Brazilian assets. Starting Monday (Oct. 26, 2026), the real depreciated, the stock market fell, and sovereign risk premiums rose. This movement was linked to investor reactions to the election results, uncertainties regarding fiscal policy, and an international environmentThis article was written byOtaviano Canuto549 FollowersOtaviano Canuto, based in Washington, D.C area, is a senior fellow at the Policy Center for the New South, professor at George Washington University, principal of the Center for Macroeconomics and Development and a non-resident senior fellow at Brookings Institution. He is a former vice-president and a former executive director at the World Bank, a former executive director at the International Monetary Fund and a former vice-president at the Inter-American Development Bank. He is also a former deputy minister for international affairs at Brazil’s Ministry of Finance and a former professor of economics at University of São Paulo and University of Campinas, Brazil.He has authored and co-edited 8 books and over 160 book chapters and academic articles, and is a frequent contributor to numerous blogs and periodicals.Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.CommentsTo ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.Is this happening to you frequently? Please report it on our feedback forum.If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.