By Brendan O'Boyle
BRASILIA/SAO PAULO, Oct 4 (Reuters) - Brazilians head to the polls on Sunday in the first round of a narrowly split election after a campaign dominated by corruption scandals, economic anxiety and accusations of US meddling.
Leftist President Luiz Inacio Lula da Silva, 80, is seeking a fourth term, while Senator Flavio Bolsonaro, the 45-year-old son of former President Jair Bolsonaro, hopes to return his father's right-wing movement to power.
A victory for the senator would extend
a wave of wins across Latin America by right-wing candidates aligned with US President Donald Trump, while Lula's reelection could create a headache for Washington, which has clashed with his government over trade and security.
Despite growing worries over Brazil's public finances and sluggish economic growth, the campaign has offered meager policy debate, as both leading candidates skipped the major TV debates.
If no candidate wins more than 50% of valid votes, the top two will face off on October 25. Surveys show Lula and Flavio Bolsonaro polling roughly even in a likely runoff.
Other candidates, including former state governors Ronaldo Caiado and Romeu Zema, have struggled to break through with the polarized electorate, even as Lula and Flavio Bolsonaro are each rejected by roughly half of voters, polls show.
Flavio Bolsonaro has promised to seek amnesty for his father, who is serving a sentence of more than 27 years for plotting a coup after his narrow election defeat in 2022. Lula has cast the election as a choice between "democracy and denialism" and repeatedly warned of foreign interference.
THE TRUMP FACTOR
The fallout from Jair Bolsonaro's conviction last year has colored much of the campaign.
Trump, who called that case a "witch hunt," imposed a 50% tariff on Brazil in 2025, explicitly linking the tariffs to the trial of Bolsonaro after lobbying from the Bolsonaro family to pressure Brazil's Supreme Court to drop the charges.
This year, Trump levied new tariffs over alleged unfair trade practices. Lula has cast the move as an attempt to sway the election and portrayed the Bolsonaros as too eager to please Washington at Brazil's expense.
Lula's allies have warned that the Trump administration might refuse to recognize election results if he wins. They point to a failed effort to send US officials to Brazil in order to "discuss electoral integrity," according to the US State Department.
Reuters reported on Wednesday that Brazilian intelligence officials briefed a French and German delegation on alleged US and Russian interference before the election. The US has rejected claims of interference in Brazil's affairs.
Trump has not formally endorsed a candidate, though he hosted Senator Flavio Bolsonaro at the White House and praised him publicly.
The senator, who has pledged closer ties with the US and Israel, welcomed the Trump administration's designation of Brazil's major gangs as terrorist groups, which Lula rejected.
Also in play is US access to Brazil's vast critical mineral reserves, key to Washington's push to reduce dependence on China for those materials.
ECONOMIC HEADWINDS
Despite falling inequality and unemployment, Lula has struggled to win over voters grappling with high living costs, heavy household debt and the threat of street crime and more pervasive gang activity.
Flavio Bolsonaro has sought to capitalize on cost-of-living concerns, while Lula has moved to ban online gambling and, as the race tightened, expanded welfare and proposed fresh debt relief for families.
Rising spending and public debt above 82% of GDP have stoked fiscal concerns that Brazil's president may need to address. The government lowered its economic growth forecasts for this year and next to just 2.0% and 2.3% respectively.
"Lula would likely preserve a state-led model with only modest spending restraint; Bolsonaro would likely pursue a more market-friendly agenda centered on spending cuts, privatizations, concessions, and a stronger fiscal anchor," said Alberto Ramos, chief Latin America economist at Goldman Sachs.
SCANDAL-PLAGUED CAMPAIGN
Overshadowing the policy debate, a scandal surrounding the now-defunct Banco Master has engulfed much of Brazil's political class and renewed public anger over corruption.
Daniel Vorcaro, who ran the bank, was arrested earlier this year and accused of a multibillion-dollar fraud scheme. The investigation has probed the banker's ties to figures from Supreme Court Justice Alexandre de Moraes to Flavio Bolsonaro, who is being investigated for money laundering tied to the case by the federal police.
The senator has denied any wrongdoing, although he confirmed raising millions of dollars from Vorcaro to make a movie about his father.
The banker's connections to Moraes, seen by many as a Lula ally, plunged the court into crisis a month before the vote, creating fresh problems for the president. Moraes has said the case is politically and electorally motivated for his conviction of the elder Bolsonaro.
Lula has also tried to distance himself from a federal police investigation into his son over alleged influence peddling, which his son denies.
On Sunday, voters will also elect all 513 lower house members and two-thirds of the Senate, where some lawmakers have pushed to impeach Moraes.
Congress has gained greater influence in Brazilian politics since the impeachment of former President Dilma Rousseff, a Lula ally, in 2016, raising the stakes of those legislative races.
(Reporting by Lisandra Paraguassu, Brendan O'Boyle, Ricardo Brito and Marcela Ayres in Brasilia, Luciana Magalhaes and Oliver Griffin in Sao Paulo; Writing by Brendan O'Boyle and Oliver Griffin; Editing by Brad Haynes and Aurora Ellis)
