Brazil Treasury bonds lose up to 17% after runoff, erasing electoral rally

Brazilian inflation-linked and fixed-rate Treasury bonds have fallen sharply in the week following the second round of elections, with yields on IPCA+ bonds rising to 7.89% and prefixados to 15.36%, above pre-first-round levels. The losses, up to 17%, reflect market repricing of fiscal and political risk, though they only materialize for early sellers. This signals deteriorating investor confidence in Brazil's fiscal trajectory.

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