Ed Miliband's chances of becoming the next Chancellor have collapsed on prediction markets, with traders switching sharply to Yvette Cooper and Shabana Mahmood in the past 48 hours.
Miliband, the energy secretary and a close ally of incoming prime minister Andy Burnham, had been the clear favourite for weeks, trading above 50% for much of late June and early July.
He is now priced at 15% on Polymarket, the crypto-based prediction market where users bet on the outcome of real-world events.
Cooper, the foreign secretary, has taken the lead at 47%, with Mahmood, the home secretary, second on 31% after a 10% jump.
Pat McFadden, the work and pensions secretary and until recently one of the frontrunners, has fallen 7%.
The market has turned amid reports that senior allies of Burnham believe they have succeeded in blocking Miliband from the Treasury, on concerns he would become a lightning rod for criticism of the government.
That is despite suggestions that Miliband was willing to soften his opposition to North Sea drilling in exchange for the job.
Opposition to his candidacy has come from unions, including the GMB and from Labour MPs in industrial seats who blame his net zero agenda for high energy costs.
The identity of the next Chancellor matters to markets because it signals whether Burnham will tack to the centre or govern from the left.
Cooper's appointment would point to fiscal restraint, higher defence spending and welfare cuts, reassuring investors, while Miliband would imply a focus on clean energy and welfare spending funded by tax rises.
Cooper served as chief secretary to the Treasury under Gordon Brown, the first woman to hold the post, and is married to former shadow Chancellor Ed Balls.
Mahmood has no significant economic policy record since leaving the shadow Treasury, though she is regarded as disciplined on budgets.
Rachel Reeves, the incumbent, is almost certain to be replaced. She has effectively conceded that Burnham will not keep her on, while insisting she has a long and close relationship with him.
Wes Streeting is on 4%, with Darren Jones on 1%.
Nearly $879,000 has been traded on the market.
