Politics · Brazil
Updated 16 October 2026
Where Things Stand Today
President Luiz Inácio Lula da Silva’s third term runs until 5 January 2027, and he faces Senator Flávio Bolsonaro in a runoff on Sunday 25 October 2026. His government is using the last days of the campaign to turn bills into law, from a shorter working week to debt relief for micro-entrepreneurs.
- 16 October. Congress promulgated the constitutional amendment that ends the six-day work week, known as 6×1. The five-day schedule with two paid rest days and a 42-hour week starts in 60 days, and the week falls to 40 hours 12 months later without a pay cut. Some high earners and workplaces with collective agreements are treated differently.
- 15 October. The Senate voted 78 to 0 for a bill that forgives federal debts of about 3.6 million micro-entrepreneurs, worth R$12.6 billion (about US$2.5 billion), if they keep paying their contributions for six months. The bill also raises the annual revenue cap from R$81,000 (about US$16,000) to R$140,000 (about US$27,600) by 2028 and now awaits Lula’s signature.
- 15 October. Senate President Davi Alcolumbre pulled the public security amendment (PEC 18/2025) from the agenda after senators filed amendments to lower the age of criminal responsibility. He said he wanted to avoid a rushed debate, and the text will return once senators agree on the amendments.
- 14 October. A Quaest poll found 45% of Brazilians approve of Lula’s government and 48% disapprove. The same survey gave Flávio Bolsonaro 46% and Lula 44% in the runoff, within the margin of error of two points. A Datafolha poll published on 15 October also showed a technical tie, with Flávio at 51% and Lula at 49% of valid votes.
- Since 5 June. The United States treats two Brazilian gangs, Comando Vermelho and the Primeiro Comando da Capital, as foreign terrorist organisations. Brazil’s government had tried to avoid the label.
Key Facts
- —Who Luiz Inácio Lula da Silva of the Workers’ Party (PT), president since 1 January 2023 in his third term.
- —What now A runoff against Senator Flávio Bolsonaro of the Liberal Party (PL) on Sunday 25 October 2026, with the winner taking office on 5 January 2027.
- —Approval 45% approve and 48% disapprove of his government, according to Quaest (10 to 13 October 2026).
- —Why it matters in the US US investors in Brazilian bonds, the real and Petrobras receipts follow the government’s fiscal choices, and Washington now treats two Brazilian gangs as terrorist groups.
- —Prediction markets Polymarket gives Lula 23.5% to win the presidency and Kalshi, a US exchange regulated by the CFTC, gives 24% on its last trade (16 October 2026, 10:50 a.m. ET).
- Petrobras Sheds US$24B in Value on Lula Win 27 Oct 2026
- Bolsonaro Party Accepts Lula Win, Not Flávio 27 Oct 2026
- Brazil Late Votes Equal 0.8% of Lula Margin 27 Oct 2026
- Lula Party Pledges Surplus Every Year 27 Oct 2026
- Brazil Stocks Fall 13.9% After Lula’s Win 26 Oct 2026
- Brazil Retail Stocks Plunge After Lula Win 26 Oct 2026
- Argentine Stocks Fall After Lula Win 26 Oct 2026
- Brazil Country Risk Jumps After Lula Win 26 Oct 2026
- Brazil Stocks Halted After Lula Win 26 Oct 2026
- Brazil’s Real Sinks 8% After Lula Win 26 Oct 2026
Lula Government Key Facts and Numbers
Currency conversions use 5.08 reais per US dollar, the market rate of 16 October 2026. The voting results of the first round come from the electoral court (TSE).
How the Lula Government Works Today
Lula governs through a coalition that needs votes in both houses of Congress, where the opposition is strong. That is why the biggest items of this term, such as the tax reform and the new work week, took years to pass.
The Senate and the Chamber of Deputies are led by Davi Alcolumbre and Hugo Motta, who decide what reaches a vote and when. The president can propose, but the two speakers set the pace.
The Supreme Federal Court (STF) also shapes government policy through its rulings on elections, taxes and security. Lula has a seat to fill on that court, and the Senate must approve his pick.
Who Is Involved
What Prediction Markets Say
- Polymarket, president: Flávio Bolsonaro 76.2%, Lula 23.5%, with about US$184.5 million traded (16 October 2026, 10:50 a.m. ET).
- Kalshi, president: Flávio Bolsonaro 78%, Lula 24% on the last trades, with 6.2 million contracts traded. Kalshi is a US exchange regulated by the CFTC, the federal derivatives regulator.
- Polymarket, Supreme Court pick: 52.5% that Lula announces a new nominee by 31 December, with about US$8,900 traded on that contract.
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.
What to Watch
The runoff on Sunday 25 October decides who governs from 5 January 2027. Lula must also decide whether to sign the micro-entrepreneur debt bill, which reached him with unanimous Senate support.
Brazil publishes mid-month inflation on Friday 23 October, and economists forecast 0.4% for the month and 4.6% over twelve months. The last reading was 0.7% and 4.47%.
The central bank’s rate decision follows on Wednesday 4 November. The security amendment and a new Supreme Court nominee are the two open items for the Senate, and no legal deadline applies to either.
What It Means for Readers in the United States
The runoff outcome sets Brazil’s fiscal and trade course for four years, which matters for holders of Brazilian bonds, the real and Petrobras receipts. Measures with a price tag, such as debt forgiveness and a shorter week, add to the spending debate.
The terrorist label on two gangs also ties Brazil’s security policy to US sanctions law. Brazilian banks and companies that deal with those groups face US legal risk under that label.
What Is Not Known
No poll can say who will win, because both runoff candidates sit inside the margin of error in the latest Quaest survey. Prediction market prices are bets, not polls, and they show a clearer Flávio lead than the polls do.
It is also unclear when the Senate will vote on the security amendment. Whom Lula would nominate to the Supreme Court is open too.
Background: Brazil’s Governors Map: 20 Won Outright, Seven Runoffs.
Frequently Asked Questions
What is the latest Lula government news?
On 16 October 2026 Congress promulgated the end of the six-day work week, and on 15 October the Senate approved debt relief for 3.6 million micro-entrepreneurs. The security amendment was pulled from the Senate agenda the same day.
What is Lula’s approval rating?
A Quaest poll released on 14 October 2026 found 45% approve and 48% disapprove of his government. It surveyed 2,154 people between 10 and 13 October with a margin of error of two points.
When is the Brazilian presidential runoff?
The runoff between Lula and Flávio Bolsonaro is on Sunday 25 October 2026. The winner takes office on 5 January 2027.
Who is Brazil’s finance minister?
Dário Durigan has led the Finance Ministry since 20 March 2026. He succeeded Fernando Haddad, who left the post.
What is the 6×1 work schedule?
It is the schedule in which employees work six days and rest one. An amendment promulgated on 16 October 2026 replaces it with five working days and two paid rest days, and the maximum week falls to 40 hours in two steps.
Is there a vacancy on Brazil’s Supreme Court?
Yes, the seat of Luís Roberto Barroso has been vacant since he left in October 2025. The Senate rejected Lula’s nominee Jorge Messias by 42 votes to 34 on 29 April 2026.
Sources: Senate: end of the 6×1 schedule approved · Agência Brasil: Congress promulgates the amendment · Agência Brasil: Senate approves MEI debt relief · Agência Brasil: security amendment pulled · Senate: Messias nomination rejected · US State Department: terrorist designation · Agência Brasil: Durigan named finance minister · Quaest poll of 14 October (O Liberal)
Read more: Brazil election 2026 runoff guide · Brazil election polls · Who is Lula · Lula government indicators for investors · Brazil news today · All Brazil news
This article was drafted with automated assistance and reviewed before publication. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief
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