Brazil’s election slugfest

Brazilians have four weeks to wait to find out who’ll be their next president after a surprisingly strong showing by incumbent Jair Bolsonar [View in browser]( [Bloomberg]( Follow Us [Get the newsletter]( Brazilians have four weeks to wait to find out who’ll be their next president after a surprisingly strong showing by incumbent Jair Bolsonaro prevented a first-round win by the leftist Luiz Inacio Lula da Silva. While Lula beat Bolsonaro by more than 6 million votes in yesterday’s ballot, he fell short of the 50% mark needed for victory. That’s even as some pollsters had predicted he’d get over the line, and indeed that the margin over Bolsonaro would be large. Instead, the split was 48% to 43%. The president secured the states of Sao Paulo and Rio de Janeiro, blunting Lula’s strength in the north. His allies also won key gubernatorial and legislative races. Key reading: - [Brazil Presidential Race Goes to Runoff as Lula Falls Short]( - [Bolsonaro Has Momentum Ahead of Brazil Runoff: Analyst Reaction]( - [Brazil Assets Set to Outperform as Lula, Bolsonaro Go to Runoff]( - [Pollsters Fail to Capture Bolsonaro Support Again in Brazil Vote]( Markets are likely to react positively to the news because even if Lula prevails, he is likely to have less wiggle room to pursue his left-wing agenda through congress. Lula is a 76-year-old former union leader and is seeking his third term, having governed the nation between 2003 and 2010 (after which he spent time in jail on corruption charges he disputed). Addressing supporters in Sao Paulo, he likened the outcome to a sporting match that had gone into extra time. Bolsonaro seemed relatively restrained last night. He didn’t repeat his comments aired frequently during the campaign about the electronic voting system being ripe for fraud, though he attacked pollsters for what he called their “lies” in having predicted Lula could romp home. Mostly, he focused on his desire to better explain the state of the economy to Brazilians, many of whom feel left behind even as growth improves. Latin America’s largest economy is already a deeply polarized nation, where the two lead candidates captured almost 92% of the vote between them without much space for alternatives. With Bolsonaro heavily on the right and Lula on the left, the prospects for volatility are high. — [Juan Pablo Spinetto]( Lula supporters react to the vote count in Rio de Janeiro. Photographer: Pedro Prado/Bloomberg UK politics are entering a new era. Get the latest in your inbox with [The Readout]( from Allegra Stratton. And if you’re enjoying this newsletter, click [here]( to sign up for Balance of Power. 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It comes at a time of rising interest rates globally and shrinking liquidity, factors that have already sent bonds of the riskiest borrowers such as Ghana and Zambia crashing, and currencies including South Africa’s rand to near pandemic lows. Bloomberg TV and Radio air Balance of Power with [David Westin]( weekdays from 12 to 1pm ET, with a second hour on Bloomberg Radio from 1 to 2pm ET. You can watch and listen on Bloomberg channels and online [here]( or check out prior episodes and guest clips [here](. 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Thanks to the 32 people who answered Friday’s quiz and congratulations to Hugo Stahlie, who was the first to name Iran as the country in which the daughter of a former president was arrested for “inciting rioters.” And finally ... US President Joe Biden will visit Florida on Wednesday to survey the damage left by Hurricane Ian as officials there struggle to ascertain a death toll that, officially, neared 50. More than 640,000 houses remained without power, and Senator Marco Rubio said the [devastation]( means some of the state’s oldest and most popular beach destinations will never look the same. The only access to the Matlacha neighborhood was destroyed near Fort Myers, Florida, on Sept. 30. Photographer: Ricardo Arduengo/AFP/Getty Images Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. You received this message because you are subscribed to Bloomberg's Balance of Power newsletter. 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