(Bloomberg) -- It seems Jacinda-Mania has caught the attention of the currency market.
New Zealand's dollar spiked lower Thursday as an opinion poll put the country's opposition Labour Party, under new leader Jacinda Ardern, in front of the ruling National Party for the first time ahead of the Sept. 23 election.
Traders are scrambling to protect against a kiwi selloff should Ardern -- who has vowed to boost spending on education, look at a capital-gains tax and change the governance structure of New Zealand's central bank -- win enough votes to try and form a government. The volume of options on the Australian dollar-kiwi exchange rate jumped 40 percent to about $4 billion last session, more than five times the average.
The specter of political change is weighing on the kiwi, especially against currencies other than the greenback, Philip Borkin, senior economist at Australia & New Zealand Banking Group Ltd., wrote in a research note Friday.
--With assistance from Garfield Reynolds
To contact the reporter on this story: Masaki Kondo in Singapore at mkondo3@bloomberg.net.
To contact the editors responsible for this story: Tan Hwee Ann at hatan@bloomberg.net, Emma O'Brien
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