Race for the Planalto: Electoral polarization dictates risk premium in exchange rates

The official start of the presidential race in the country's three largest electoral colleges, concentrating 65.5 million voters and 42% of the national electorate, immediately redefines the political and economic risk calculation for Brazilian markets. As tickets intensify their strategies in the states of São Paulo, Rio de Janeiro, and Minas Gerais, institutional capital is recalibrating its fiscal and regulatory expectations for the coming years. This initial movement in the dispute for the Palácio do Planalto demonstrates that the polarization between PT's economic guidelines and the liberal-conservative opposition will be the central axis of price formation in domestic assets. In this scenario of intensifying electoral dispute, the commercial Dollar level quoted at R$ 5.2236 and its upward variation of +2.12% over a 7-day window reflect the immediate nervousness of financial agents in the face of fiscal uncertainty. At the same time, inflation measured by the 12-month accumulated IPCA at 4.44% — despite a negative variation of -4.31% over a 30-day horizon — imposes a severe limit on any discourse of irresponsible fiscal expansionism without inflationary consequences. The benchmark interest rate maintained at the Selic target of 14.00% per year acts as a safety anchor, but also raises the carrying cost of public debt, making the electoral debate on public accounts even more sensitive.