Elections, the dollar, and predictability: why currency hedging gains momentum in times of uncertainty

The approaching election cycle is already impacting how Brazilian companies manage their exposure to the dollar. Data from Ouribank shows that the volume of currency hedging operations carried out between January and May 2026 grew by nearly 35% compared to the same period last year, reflecting growing concern over market volatility and its impact on costs, revenues, and margins.

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“The increase in these operations shows that companies are more concerned about the election landscape and currency volatility. Anyone with foreign currency assets or liabilities knows they could suffer significant losses if they aren't protected at the right time,” says Raphael Coracini, FX Desk Manager at Ouribank.

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This trend is occurring against a backdrop of significant fluctuations in the US dollar. The Ptax rate, the Central Bank's official benchmark for exchange rates, began the year at R$ 5.4372 and fell to R$ 5.0780 by mid-June. Although the trend was downward during this period, the variations recorded over the months reinforce an environment of uncertainty that typically intensifies during election years.

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Historically, election periods increase market sensitivity to polls, economic proposals, shifting expectations, and fiscal policy debates. This causes the exchange rate to react more quickly to new information, increasing volatility and making forecasts more difficult. For companies that import supplies, export products, or have contracts tied to foreign currencies, this instability can directly affect financial planning.

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The challenge is even greater because currency risk is no longer dependent solely on the domestic scenario. Central bank decisions, geopolitical conflicts, global economic slowdowns, and changes in international trade also influence the dollar's behavior, making it increasingly difficult to anticipate market movements.

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The cost of speculation

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One of the most common risks in election years is turning currency management into a bet on market behavior. According to Coracini, many companies end up delaying operations or waiting for specific dollar movements in an attempt to secure a more favorable rate.

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“Companies often speculate, believing that one candidate or another will win and that this will cause the dollar to rise or fall. Many analysts present scenarios, but no one knows exactly what will happen. When a company starts making decisions based on that expectation, it puts its margins at risk,” he says.

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According to the executive, the primary function of hedging is not to generate financial gains, but to eliminate uncertainty. By locking in an exchange rate for a future transaction, a company can preserve the margin projected at the time of sale or purchase, regardless of subsequent market fluctuations.

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“By hedging, a company removes itself from political risk and the need to monitor market movements on a daily basis. It secures its margins and can focus its efforts on what really matters: its product, its customers, and its growth strategy,” says the executive.

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The logic is simple. For an importing company, a spike in the dollar can unexpectedly drive up costs and compromise the profitability of contracts already signed. For exporters, sudden shifts can also impact revenue, cash flow, and financial planning. In both cases, predictability becomes just as important as the exchange rate itself.

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This perception has been gaining traction among companies of all sizes and sectors. According to Coracini, there is no specific segment that is more exposed to risk. Any organization with assets, liabilities, revenues, or expenses in foreign currency is subject to the effects of exchange rate volatility.

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For this reason, Ouribank expects demand for hedging operations to continue growing in the coming months. The nearly 35% increase observed in the first half of the year reinforces a trend that has been solidifying in recent years: hedging is no longer just a tool used during times of crisis, but has become a standard part of corporate financial routines.

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“Currency hedging should no longer be viewed merely as a strategy. It needs to be part of a company’s day-to-day operations. Those who aren't accustomed to using hedging mechanisms risk losing margins, competitiveness, and planning capacity,” the executive says.

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In Coracini’s view, the rise in demand also reflects a shift in market mindset. More than just purchasing a financial product, companies are looking to incorporate foreign exchange risk management into their decision-making processes. “Our role isn't just to offer hedging. We work to show clients how protection can be integrated into the daily business, bringing more security and predictability to operations.”

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In an environment where political, economic, and international factors can rapidly alter the dollar’s behavior, currency hedging plays an increasingly vital role: allowing companies to make decisions based on their business objectives rather than market fluctuations.

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