US rethinking how it releases economic data
Federal officials are discussing changes to how the government releases sensitive economic data, seeking to bring the system in line with fast-moving financial markets, reports Brody Mullins and Colleen McCain Nelson of The Wall Street Journal.
Mullins and Nelson write, “At issue is the traditional way that the government releases economic data. Under a system known as a lockup, many government departments give economic data to reporters on an embargoed basis. The reporters have a defined period to write their reports. When the embargo is lifted, reporters are allowed to publish. The idea is to give reporters time to digest complex economic reports and produce accurate accounts.
“The system of lockups has come under fire in recent years after several media firms, including Dow Jones & Co., publisher of The Wall Street Journal, started using the lockup to sell raw data from the government reports to high-frequency trading firms. That data, sent along high-speed transmission lines, allows firms to make computerized trades before individual traders can react.
“Dow Jones has said it ‘always endeavors to follow all lockup procedures and rules, and would never sanction—and is not aware of—any intentional violations.’
“In one snafu that highlighted the loose security surrounding the data, an official at the Federal Reserve mistakenly sent details of a regular Fed meeting to a group of people, including investors, a full day before the minutes were scheduled to be released to the public.”
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