iPredict Ltd
New Zealand Weekly Economic & Political Update
Little Expected to Be Elected Labour Leader on Tuesday

13 November 2014

www.ipredict.co.nz

The probability Andrew Little will be elected leader of the Labour Party on Tuesday has improved again, according to the combined wisdom of the 8000+ registered traders on New Zealand’s predictions market, iPredict. Mr Little now has a 71% chance of being elected. There is a 60% probability his deputy will be one of Jacinda Ardern, Nanaia Mahuta or Annette King. Paula Bennett is now favourite to be the next National Party leader although John Key remains picked to lead his party into 2017 and National is narrowly expected to win the election that year. There has been a small improvement in the forecast unemployment rate and current account deficit for the December quarter and for the prospects a Trans-Pacific Partnership (TPP) agreement will be ratified by the US Congress by 1 July 2017.

Politics:

Next Labour Leader expected to be:
Andrew Little: 71% probability (up from 69% probability last week)
Grant Robertson: 24% probability (down from 26% last week)
David Parker: 5% probability (steady compared with last week)
Nanaia Mahuta: 0% probability (steady compared with last week)

Next Labour Deputy Leader expected to be:
Jacinda Ardern: 36% probability (up from 31% last week)
Nanaia Mahuta: 16% probability (up from 11% last week)
Annette King: 8% probability (down from 13% last week)
Andrew Little: 7% probability (down from 8% last week)
Grant Robertson: 5% probability (down from 10% last week)
David Shearer: 5% probability (down from 6% last week)
David Parker: 4% probability (down from 7% last week)
Stuart Nash: 4% probability (steady compared with last week)
Other: 16% probability (up from 13% last week)

• John Key expected to remain National leader until at least the end of 2016 (72% probability, steady) and has a 46% probability of remaining National leader until at least the end of 2017 (down from 47% last week)
• Paula Bennett now favourite to become National Party leader if a vacancy arises (29%, steady compared with last week), followed by Steven Joyce (27% probability, down from 32% last week), Jonathan Coleman (8%, down from 9% last week) and Simon Bridges (8%, up from 7% with last week)
• Next election expected in 2017 (92% probability, steady compared with last week)
• National expected to win 2017 General Election (52% probability, down from 53% last week)

Economics:
Quarterly GDP growth expected to be:
• 0.8% of GDP in the September quarter (steady compared with last week)
• 0.8% in the December quarter (steady compared with last week)
• 1.0% in the March 2015 quarter (steady compared with last week)
• 1.1% in the June 2015 quarter (steady compared with last week)

• As forecast by iPredict, unemployment was 5.4% in the September quarter, and is now expected to be 5.3% in the December quarter (down from 5.4% last week)
• Unemployment stocks for 2015 will be launched in the near future
• Current account deficit expected to be 2.6% of GDP in the September quarter (steady compared with last week) and 3.8% of GDP in the December quarter (down from 3.9% last week)

Annual inflation expected to be:
• 1.1% to end of December quarter (steady compared with last week)
• 1.4% to end of March 2015 quarter (steady compared with last week)
• 1.8% to end of June 2015 quarter (steady compared with last week)
• 2.1% to end of September 2015 quarter (steady compared with last week)

Official Cash Rate priced to be:
• 3.499% on 11 December (down from 3.500% last week)
• 3.501% on 29 January (down from 3.505% last week)
• 3.514% on 12 March (down from 3.517% last week)
• 3.549% on 30 April (down from 3.552% last week)
• 3.597% on 11 June (down from 3.605% last week)
• 3.653% on 23 July (new stock bundle)
• 3.710% on 10 September (new stock bundle)
• OCR stocks out to June 2016 will be launched in the near future

Fiscal balance expected to be:
• -0.02% of GDP in 2014/15 (up from -0.04% last week)
• 0.95% of GDP in 2015/16 (steady)
• 1.98% of GDP in 2016/17 (steady)
• 2.37% of GDP in 2017/18 (steady)

Foreign Affairs/Constitution:
• There is a 34% probability New Zealand and South Korea will sign a Free Trade Agreement by 1 December 2014 (down from 36% last week)
• The Trans-Pacific Partnership is not expected to be ratified by the US Congress before 1 July 2017 (only 23% probability it will be, up from 20% last week)
• Helen Clark’s prospects of being the next UN Secretary General have fallen to 25% probability, down from 40% last week
• There is a 19% probability New Zealand will become a republic by 2020 (steady compared with last week)

iPredict Ltd is owned by Victoria University of Wellington. Details on the company and its stocks can be found at www.ipredict.co.nz.

The weekly economic and political update is prepared by Exceltium Ltd on a pro bono basis and is based on a snapshot taken at a random time each week. This week’s was taken at 10.40 am today.

ENDS

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