Or are punters just wishful thinking?

If the betting markets have got this one right then we should be seeing the post-budget polls showing a move away from Labour and for the Tories to be increasing their lead again.

The chart shows just one market – the price converted into an implied probability of Labour securing an overall majority at the general election. Other general election markets have seen similar reactions with gamblers seeming to think that yesterday’s key statement by Chancellor Darling would not help the government.

Generally, in at least two out of three cases, punters do second guess the polls and the betting is a reasonable indicator. But there have been enough instances of this not being the case for me to be ultra-cautious.

It was always clear that the PBR statement had the potential to be a game-changer – the question was which way.

In my betting I’ve closed down my Labour buy positions on the spread markets but am somewhat hesitant to do more. Hopefully there will be voting intention polls in the next forty-eight hours.

Mike Smithson