Brazil Stocks Face Inflation Data After 1.15% Drop | Morning Call, Oct 23

Source: market close, 22 October 2026.

01 The setup in one read

The day before Brazil’s runoff election is almost never quiet, and this Friday is no exception. Two things matter at the open: the 09:00 BRT IPCA-15 inflation preview, and Bradesco’s third-quarter earnings call at 10:30 BRT.

The IPCA-15 is the mid-month gauge of consumer prices. A reading near the 0.43% consensus would give the Central Bank room to keep cutting the Selic, Brazil’s benchmark rate, which currently sits at 13.75%.

Bradesco, one of Brazil’s largest private banks, reported after Thursday’s close. Its call this morning gives money managers the first crack at asking whether credit quality is holding up.

And the election looms over all of it. Sunday’s runoff between Flávio Bolsonaro and Luiz Inácio Lula da Silva is too close to call, with Datafolha showing the two men statistically tied in valid votes.

02 Where Brazil is set to open

Pre-market futures levels were not yet available when this report was written, so the inflation print is the first guide to the open. The board above shows both the Ibovespa and the real under pressure in the last session, leaving the street with less conviction about the open than usual.

The first clear signal will arrive right at 09:00 BRT with the inflation print. Bradesco’s call at 10:30 BRT is the stock-specific catalyst, especially for the financial-heavy Brazilian index.

03 On the B3 radar today — the inflation test and Bradesco

The day’s calendar is unusually front-loaded. By 11:00 BRT the market will have absorbed the two most important domestic signals — inflation and Bradesco’s management commentary — and the rest of the session will be about positioning for the weekend and Sunday’s vote.

The late-day CFTC data on speculative positioning in the real is a lagging but telling indicator: it shows how global hedge funds were positioned before the inflation data and the election.

04 Copom and the macro backdrop

The Selic sits at 13.75% after the Central Bank began easing from 15% in March, most recently by 0.25 percentage point at its 16 September meeting. That easing cycle supports Brazilian equities, and the IPCA-15 is the fuel gauge.

In the United States, initial jobless claims fell to 194,000 against a forecast of 200,000. Continuing jobless claims rose to 1,728,000 (forecast 1,720,000), and the four-week average eased to 197.75 thousand (forecast 200 thousand), pointing to a firm labour market (RT economic calendar, RT). Such data feeds into expectations for US interest rates, which in turn affect the real.

A print at or below the 0.43% monthly estimate would keep the dovish case alive. The annual rate is expected to rise to 4.73% from 4.47%.

The risk to the trade is a hot print. If the monthly number comes in above, say, 0.50%, traders will start to question whether the Selic can keep falling at the current pace.

That would hit rate-sensitive shares hardest: banks, retailers, homebuilders and carmakers — the stocks most sensitive to interest rates.

05 Corporate stories to watch today

Bradesco is the day’s headline corporate event. The bank reported a recurring net profit of R$7.1 billion (about US$1.4 billion at RT’s 5.04 reais per dollar), up 14.6% on a year earlier, and the 10:30 BRT call will reveal how management sees credit costs.

Brazilian banks are watching credit quality as interest rates stay high. Bradesco’s call is the first signpost for how the sector is managing it.

Large liquid names such as Vale, Petrobras and Itaú are the stocks global money often uses to express a view on Brazil. Their flow will show how foreign funds are thinking about the weekend gap.

No other verified major corporate events are scheduled for today. No ex-dividend dates are confirmed for today, so attention will concentrate on the inflation print and Bradesco.

06 The levels to watch at the open

Watch the real’s first reaction to the IPCA-15 print. A move toward the 5.00 level against the dollar on a soft number would signal conviction that the Selic easing continues; a push back above 5.05 would show the market is getting nervous.

For the Ibovespa, the psychologically important 204,000 area from the board is the first line. If the index opens above it and holds, dip-buyers are taking the election risk in stride.

Bradesco’s preferred shares, BBDC4, will be the clearest single-stock read. A bounce after the earnings call would support the banks; a slide would suggest the market is not convinced by the quarter.

But the real level to watch is time, not price: with Sunday’s runoff a coin toss, the last 90 minutes of trading may matter more than the first hour.

07 What to watch

• IPCA-15 inflation print: The 09:00 BRT number is the day’s pivot — soft validates the Selic easing trade, hot reprices it
• Bradesco Q3 call and share reaction: First bank to report this cycle; BBDC4’s move after 10:30 BRT is the sector’s signal
• USD/BRL’s first reaction to inflation: A decisive move in the real sets the tone for the whole Brazilian risk complex
• Weekend positioning before Sunday’s runoff: Thin volumes and last-hour flows may be driven by fear of the election gap, not fundamentals

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What Prediction Markets Say

Traders on Polymarket, a prediction market where people bet real money, put Flávio Bolsonaro’s chance of winning the 25 October runoff at 76.8 percent and Lula’s at 23.5 percent at 11:34 p.m. ET on Thursday, 22 October. About US$192.3 million had been traded on that market.

Kalshi, a prediction market regulated in the United States by the CFTC, the federal derivatives regulator, showed 76 percent for Flávio and 24 percent for Lula at the same time. These prices are bets by traders, not polls, and they can move within minutes of a debate or a new survey. The official result will come from Brazil’s electoral court, the TSE.

Why we show this: prediction markets turn real-money bets into a live probability that moves within minutes of the news, which is why investors, campaigns and newsrooms in the United States now follow them closely. We show them next to polls and official results, never instead of them.

Frequently Asked Questions

What is the IPCA-15 and why does it matter today?

It is Brazil’s mid-month consumer-price preview, released by the statistics agency IBGE. Today’s October reading tests whether the Central Bank can keep cutting the Selic, its benchmark rate.

Who is reporting earnings today?

Bradesco, one of Brazil’s largest private banks, released third-quarter results after Thursday’s close and holds its investor call at 10:30 BRT (9:30 a.m. in New York).

What is at stake in Sunday’s election?

The presidential runoff between Flávio Bolsonaro and Luiz Inácio Lula da Silva, with final Datafolha polls showing a statistical tie. Today is the last tradeable session before the vote.

Where can I find today’s market levels?

The board embedded in this article shows the last settled prices for the Ibovespa, USD/BRL and other regional markets. Pre-market futures levels were not available when this report was written.

Market data: RT. Economic calendar: RT economic calendar (RT).

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief

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