Brazilian Treasury yields fall as long-term IPCA+ rates drop

Yields on Brazilian government bonds traded through Tesouro Direto fell on Tuesday, September 29, 2026. Long-term inflation-linked bonds led the decline amid signals of progress in negotiations between the United States and Iran regarding the Strait of Hormuz. Stock futures traded flat after the previous day's surge in crude oil, while the commercial dollar opened lower, reversing part of its prior gain.

Among inflation-linked debt, the yield on the Tesouro IPCA+ 2050 dropped 10 basis points, moving from 7.13% to 7.03%. The IPCA+ with Semiannual Interest 2060 fell 11 basis points from 7.18% to 7.07%, and the IPCA+ with Semiannual Interest 2045 also slipped 11 basis points from 7.31% to 7.21%. As of 9:56 a.m., the IPCA+ 2032 traded at IPCA plus 7.61%, the IPCA+ with Semiannual Interest 2037 stood at IPCA plus 7.47%, and the IPCA+ 2040 yielded IPCA plus 7.21%.

Fixed-rate paper posted narrower declines. The yield on the Prefixado 2029 eased from 13.90% to 13.87%, the Prefixado 2032 slipped from 14.15% to 14.08%, and the Prefixado with Semiannual Interest 2037 declined from 14.10% to 14.02%. The floating-rate Tesouro Selic 2031 yielded Selic plus 0.0778%, while the Tesouro Reserva 2036 traded at flat Selic.

Domestically, PNAD survey data showed Brazil's unemployment rate near its historical low at 5.3%, matching analyst forecasts. Rai Chicoli, chief strategist at Monte Bravo, stated that the print preserves the central bank's view of decelerating activity alongside a tight labor market. Leonardo Costa, an economist at ASA, noted that the numbers remain consistent with a gradual cooling of activity without abrupt deterioration in employment. Meanwhile, an AtlasIntel/Bloomberg poll showed Lula at 45.3% and Flavio Bolsonaro at 42.2% in the first round, with Flavio leading by 0.1% in the second round, leaving the race in a technical tie.