Brazil’s currency is getting slammed as a jailed candidate leads its presidential polls

The Brazilian real extended losses Thursday as political chaos compounded fears surrounding a currency that has already been under pressure.

The Brazilian real was down 2% around 3:15 p.m. ET, holding close to record lows. The currency, now at its weakest level against the dollar since at least 2016, has shed nearly a fourth of its value this year.

The country is facing a high degree of uncertainty ahead of its presidential election, which is set to take place in October. A poll out Monday showed jailed former President Luiz Inacio Lula da Silva holding a double-digit lead against far-right Congressman Jair Bolsonaro. Lula is facing corruption charges and is expected to be barred from the race.

In polls that excluded the leftist leader, Bolsonaro held a lead over former Gov. Geraldo Alckmin, whose policies hang closer to the center. Alckmin would be the preferred winner in the eyes of investors, according to the Associated Press.

The real has been under pressure amid a dollar rally and a broader selloff of emerging markets currencies. It has been one of the currencies most affected by a steep slide in the Argentine peso this year, according to JPMorgan strategists led by John Norman.

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Markets Insider