Brash-led Act tipped to win nine seats

The appointment of Don Brash as leader of the Act Party is likely to give a big boost to the party’s election result, according to prediction market website iPredict.

Dr Brash, a former National Party leader and Reserve Bank governor, controversially replaced Rodney Hide as Act’s leader last week after a public leadership challenge.

This has seen Act’s projected support at this year’s general election more than double in the space of a week, jumping from 3.1% to 7% in this week’s iPredict snapshot.

National’s projected support has dropped slightly with the resurgence of Act, from 47.5% to 46%, while Labour is predicted to get 29.3% of the party vote (up from 28.9%).

The Green Party is forecast to get 6.9%, while New Zealand First’s predicted party vote is getting close to the crucial 5% threshold, rising to 4.8% from 4.2% last week.

United Future is predicted to get 1.6%, the Maori Party 1.5% and Hone Harawira’s new Mana Party 1.3%.

Taking into account predicted electorate results, this would significantly shift the balance of power in Parliament, giving Act much more clout with nine MPs in a 121-member Parliament (it currently has five).

National would have 59 MPs, Labour 37, the Greens nine, the Maori Party three and United Future and the Mana Party two.

With 61 MPs required for a majority National could form a government with the support of Act, the Maori Party or United Future.

The economic outlook has changed in the last week as well.

There is now an 83% chance a current account surplus will be reported for the year ending March, up from 66% last week.

Petrol price fears have also receded: the probability of unleaded petrol exceeding $2.30 per litre is down to 42%, from 50% last week, 52% the week before and 54% three weeks ago.

The probability it will exceed $2.40 per litre is now down to 21%, from 28% last week, 30% the week before and 34% three weeks ago, while the probability it will go above $2.50 per litre is just 15%, down from 23% last week.

Reserve Bank Governor Alan Bollard is predicted to leave the Official Cash Rate at 2.5% until at least December 8, with a 50% probability he will leave it unchanged even longer.