Thanks to the Android developers, the latest virtual keyboard from Android 2.3 aka Gingerbread is out for download on Android 2.2 smartphones with root access.
I say again, this is only for rooted Android 2.2 phones.
Download .zip file HERE (Version with working auto-correct/prediction )
2. Place on root of SD Card and boot into Recovery.
3. Install .zip as you would themes etc.
4. Reboot and select “Android Keyboard” under Input Method and you are good to go.
Via Droid Life