Brazil 10-Year Yield Rises Amid Global Bond Selloff

2026-10-01 15:15 By Isabela Couto 1 min. read

Brazil’s 10-year government bond yield rose above 14.15% in October amid external pressure from a global bond selloff ahead of the first round of the presidential election.

Renewed selling in US Treasuries fueled a broader global bond rout, while higher oil prices added to inflation concerns and reinforced expectations of further interest-rate hikes by central banks, keeping government bonds under pressure worldwide.

Meanwhile, final presidential election polls and a debate in the days ahead of the first round will mark the end of the campaign.

Recent polls have reinforced expectations of a tight presidential race.

On the data front, Brazil’s manufacturing sector posted its sharpest deterioration in operating conditions since April 2023, according to S&P Global PMI data.

Recent labor market data remained consistent with gradual cooling and expectations for GDP to be near flat in 3Q26, despite strong payrolls, keeping expectations for continued Selic easing intact.



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Brazil 10-Year Yield Rises Amid Global Bond Selloff
Brazil’s 10-year government bond yield rose above 14.15% in October amid external pressure from a global bond selloff ahead of the first round of the presidential election. Renewed selling in US Treasuries fueled a broader global bond rout, while higher oil prices added to inflation concerns and reinforced expectations of further interest-rate hikes by central banks, keeping government bonds under pressure worldwide. Meanwhile, final presidential election polls and a debate in the days ahead of the first round will mark the end of the campaign. Recent polls have reinforced expectations of a tight presidential race. On the data front, Brazil’s manufacturing sector posted its sharpest deterioration in operating conditions since April 2023, according to S&P Global PMI data. Recent labor market data remained consistent with gradual cooling and expectations for GDP to be near flat in 3Q26, despite strong payrolls, keeping expectations for continued Selic easing intact.
2026-10-01
Brazil 10-Year Yield Drops on Labor Market Cooling Signs
Brazil’s 10-year government bond yield fell to around 14.13% in late September after August labor data. Brazil created 165,827 formal jobs, above forecasts of 95,700 and up from 58,568 in July, the highest result since March. Unemployment stood at 5.3% in the rolling quarter ended in August, unchanged from the previous quarter and matching expectations. Despite strong payrolls, the marginal reading remains more moderate on a seasonally adjusted basis, while job creation remains weaker than in 2024 and early 2025. The data is consistent with gradual labor-market cooling and expectations for GDP to be near flat in 3Q26, without an abrupt deterioration. As such, it did not dent expectations for continued Selic easing. The move also came as new polls reinforced expectations for a tight presidential race few days ahead of the first round.
2026-09-29
Brazil Yields Rise on Election and Higher Inflation Forecasts
Brazil’s 10-year government bond yield rose to around 14.25% in late September following recent election polls showing President Lula widening his lead and a rise in inflation projections. A new poll showed Lula leading by a larger margin in first-round voting intentions and opening a two-point lead over Flávio Bolsonaro in a potential runoff, still within the margin for a technical tie. Bolsonaro is viewed by markets as more fiscally restrictive amid elevated domestic yields and weak business activity. Meanwhile, the BCB’s Focus survey showed that the market raised its 2026 inflation forecast from 4.92% to 4.99%, while the year-end 2026 Selic forecast remained at 13.50%. The 2026 GDP growth forecast fell from 1.88% to 1.86%, marking its third consecutive downward revision. The BCB cut its policy rate by 25 bps to 13.75% at its September meeting and left its next steps open, while Copom’s minutes were more hawkish than expected.
2026-09-28