ING’s Chris Turner reports the Brazilian Real (BRL) underperformed in an otherwise supportive carry environment after a bank downgraded Brazilian equities and a new poll showed President Lula widening his lead ahead of October elections. Election risks versus strong carry"In an otherwise supportive market for FX carry trades, the Brazilian real was a notable under-performer yesterday. Driving that was both a sell-side bank downgrading Brazilian equities to neutral from overweight, and a new poll result ahead of Brazilian presidential elections in early October." "This seems the first day that politics has really started to hit the real this year. 13.4% implied yields through the one-month non-deliverable forwards and Brazil's position as a net energy exporter should keep the currency reasonably in demand."