Haddad is likely to replace incarcerated former President Luiz In?cio Lula da Silva in the ballot after an electoral court blocked him from running after being convicted for graft.

Haddad's candidacy is not in danger of being blocked, as it would be virtually impossible for a trial to play out before the country's elections next month.

Lula, who has nevertheless led voter intention polls, has railed against austerity and investors believe he would be unlikely to pursue spending cuts or privatizations necessary to bring back Brazil's investment grade sovereign rating even if he were somehow elected.

The Brazilian real turned flat after the charge, moving away from an emerging-market rout that drove currencies from Chile, Mexico, Colombia and Argentina as much as 2.2 percent lower.

The sell-off also ravaged local debt markets, driving an exchange-traded fund modeled on JPMorgan's local emerging-market debt index to a record low.

Trade tensions have rattled global and emerging markets, with fears rising again after US President Donald Trump's announcement over the weekend that there was no need to keep Canada in the North American Free Trade Agreement.

This followed a report that Trump was prepared to ramp up a trade war with China and could be ready to impose more tariffs on Chinese imports as soon as Thursday.