LONDON, April 10 - A cluster of elections scheduled around the world this year could alter the policy landscape investors use to price risk, with elections in Hungary and Peru among the most immediate tests. Market participants are monitoring contests that could reopen frozen funding streams, reshape fiscal priorities and introduce volatility into currencies and fixed income markets.
Hungary
Sunday’s vote in Hungary represents the most pronounced challenge so far to Prime Minister Viktor Orban’s 16-year tenure. Polling shows the centre-right opposition party Tisza leading in many surveys, with its candidate Peter Magyar positioned as a potential successor.
Orban has used tax cuts and public sector wage increases as tools to steady voter support in an economy whose growth has lagged regional peers. At the same time, his decision to block financial assistance to Ukraine has strained relations with other European capitals and left a portion of Hungary’s EU funding, amounting to 18 billion euros ($21 billion), frozen amid concerns over democratic standards.
Economists at Goldman Sachs say a victory for Tisza could reinstate access to those funds and would "likely lead to a notable appreciation of Hungarian assets." For bond investors, the prospect of resumed EU transfers could reduce sovereign risk premia and lift Hungarian fixed income.
Peru
Peru goes to the polls this weekend for the first round of a presidential election that will also fill seats in Congress. Two right-wing candidates lead in public opinion, but Bank of America analysts judged that most contenders "do not seem to represent a major threat" to Peru’s orthodox economic policy framework.
The country’s political scene has been volatile: eight presidents have held office since 2018 amid a period marked by impeachments and corruption scandals. Yet recent growth across most sectors has supported the wider economy. Bank of America cautioned that a chaotic contest - evoking the disputed and tumultuous 2021 race - could spur capital flight. If no candidate surpasses 50% of the vote, a second round is scheduled for June 7.
United Kingdom
Local elections in the UK on May 7 have attracted atypical attention from foreign investors given the potential implications for fiscal policy. Prime Minister Keir Starmer’s Labour Party is polling behind the populist Reform UK and the Green Party in some surveys, and has encountered difficulty delivering promised growth boosts.
Bond markets are sensitive to the prospect that a fiscally moderate Starmer government could be replaced, which would tend to lift sovereign yields and weigh on sterling. The ongoing war in Iran has dampened immediate speculation over a change in government, although online prediction market Polymarket assigns a 56% chance that Starmer will be replaced by year-end. The next national election must be held by August 2029.
Colombia
Colombia’s presidential contest, with a first round scheduled for May 31, remains fluid after a fragmented showing in March’s congressional elections. President Gustavo Petro, who identifies with the left, has clashed with the central bank and sought an economic emergency decree—moves that have heightened investor scrutiny.
Some market participants have welcomed momentum behind centre-right candidate Paloma Valencia. As Barclays economist Alejandro Arreaza put it, "We are inclined to hold a constructive view, as political conditions still support a swing toward pro-market policies." For investors, a shift toward pro-market governance would bear directly on sovereign borrowing costs and private sector confidence.
Ethiopia and Zambia
Both Ethiopia and Zambia, which have experienced sovereign defaults, will hold elections over the summer where economic performance is a central issue. Zambia has drawn investor praise for reforms and rising copper production. Ethiopia’s improving outlook has been supported by expanding gold and coffee exports and foreign exchange reforms.
In Ethiopia, Prime Minister Abiy Ahmed’s Prosperity Party is widely expected to win in June amid opposition boycotts and security challenges that could complicate voting. Zambia’s incumbent President Hakainde Hichilema is broadly tipped to win in August, although spikes in energy and fertiliser prices related to the Iran war could undercut gains. Ratings agency S&P flagged that the elections pose a risk to policy continuity just as fiscal consolidation efforts begin to show progress.
Israel
Parliamentary elections in Israel, expected in October, are being framed as a referendum on Prime Minister Benjamin Netanyahu. Polling conducted before the Iran war indicated Netanyahu’s right-wing coalition would find it difficult to secure a governing majority, and subsequent polling suggests the war has done little to bolster his standing.
Israel’s economy had shown a rebound in 2025 and was projected to continue improving in 2026 before the onset of the conflict. The resulting political uncertainty could add to volatility in the shekel and in government bond markets.
Brazil
Brazil’s presidential race in October pits leftist President Luiz Inacio Lula da Silva against right-wing senator Flavio Bolsonaro, son of former President Jair Bolsonaro. Voters will also decide two-thirds of the Senate, all seats in the lower house and all 27 state governorships.
Macro indicators show inflation has eased and unemployment fell to a record low in December, but last year’s 2.3% economic growth was the weakest since the COVID pandemic. Household debt service costs are at their highest level since the series began in 2011. Oxford Economics’ Felipe Camargo suggested that a centre-right government under Bolsonaro could create a "goldilocks scenario for markets," including policies aimed at reducing inflation and reversing an upward trend in the debt-to-GDP ratio.
United States
The November mid-term elections, which will decide control of Congress, are shaping up as a significant test for President Donald Trump. His approval ratings have slid to their lowest recorded levels, exposing the Republican Party to the risk of losing its narrow congressional majorities.
Polls indicate strong public opposition to the war in the Middle East and widespread frustration over gasoline prices. Analysts caution that the uncertainty ahead of the vote could depress the dollar and equities, though in the near term the Iran conflict is likely to dominate market attention. "If Trump wants a chance to get affordability back down, well in advance of the midterms... the timing is very tight," said Grant Johnsey, head of market solutions at Northern Trust.
These contests together underline how political outcomes can directly affect funding access, fiscal trajectories and investor appetite across asset classes - from sovereign bonds and currencies to commodity exports. Markets are watching not only who wins, but how those leaders might restore or shift economic policies already embedded in expectations.