Brazil's Treasury Buys Back Up to 15 Million Fixed-Rate Bonds After Lula's Win

Brazil's National Treasury announced an extraordinary buyback auction of up to 15 million fixed-rate bonds on Monday, the first trading session after President Luiz Inácio Lula da Silva's reelection. The operation targets NTN-F bonds maturing in 2031, 2033, and 2037, with proposals accepted from 11:15 to 11:45 Brasília time. Only authorized dealers can participate, with settlement scheduled for Tuesday. The maximum cost is R$15 billion, though actual spending may be lower since the bonds' 10% annual coupon is below current market rates. The move follows the cancellation of NTN-B and fixed-rate auctions this week, leaving only Selic-linked LFTs. The intervention aims to absorb selling pressure amid volatility after Lula's victory disrupted market bets on Flávio Bolsonaro. Treasury Prefixado 2032 yields had fallen from 14.15% to 12.89% before the election.