Brazil Opposition Chances Rise in 2014 Election, Citibank Says

The increasing unity of Brazil’s opposition increases the likelihood President Dilma Rousseff will have to face a runoff in the October 2014 election, Citigroup Inc. said.

The failure of former Environment Minister Marina Silva and former Sao Paulo state Governor Jose Serra to launch their own bids has consolidated strength in the two remaining opposition candidates, Citi Research analysts Stephen Graham and Fernando Siqueira wrote in an Oct. 6 note on the company’s website. Silva joined the opposition PSB Party on Oct. 5.

“The opposition to ’Dilma’ and her PT party is suddenly stronger,” Citi said in its report. “It sets up chances of forcing a second round in which PSDB and PSB would join forces,” Graham and Siqueira wrote.

Rousseff’s lead over her closest rival widened to 22 basis points in September from 8 points at the height of protests against bus fares, corruption and poor public services in July, according to surveys by polling agency Ibope. Still, with the latest poll giving her support of 38 percent, she remains short of the 50 percent needed to avoid a second round of voting. None of the major candidates is “anti-market,” Graham and Siqueira said.

The swap contract maturing in January 2014 rose two basis points, or 0.02 percentage point, to 9.432 at 10:44 a.m. The real gained 0.07 percent to 2.2105 against the U.S. dollar.

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