(Bloomberg) -- The UK is expected to decide early in the new year whether it will continue to release key economic data before financial markets open, a practice that investors say spurs volatility that also feeds through to the real economy.
The statistics regulator said it will share its verdict early in 2025 after considering evidence from the Office for National Statistics, which compiles the figures. Currently, data are released at 7 a.m. in London, half an hour before sterling interest-rate markets open and an hour ahead of UK government bonds.
The ONS is under pressure from traders to revert back to the pre-pandemic norm of 9:30 a.m., with a Bank of England committee made up of leading market participants calling for a later release time to improve liquidity. Rates markets are vital to the pricing of trillions of pounds of assets including mortgages.
“A return to data releases within market hours supports real time risk management and is consistent with international markets,” the BOE committee said in published minutes. “Data releases outside of market hours can cause spreads to widen due to reduced liquidity. This can be transmitted to the wider economy via increased costs.”
The ONS initially changed the way it releases market-sensitive data including inflation and employment reports in response to the coronavirus pandemic. Government restrictions made so-called press lock-ins — where accredited news organizations get the data under secure conditions ahead of public release — unviable. Bloomberg News was among the media organizations that attended the briefings.
Ed Humpherson, head of the Office for Statistics Regulation, in July asked the ONS to engage with stakeholders including UK rates traders, the BOE and the media on when to release the data, and share the outcome by the start of October. However, a spokesperson for the watchdog told Bloomberg that the ONS asked for more time in order to engage with a BOE committee called the SONIA Stakeholder Advisory Group.
All members of the panel favored data releases returning to within market hours, with the exception of one who was agnostic, according to minutes of their September meeting published by the BOE. They noted that liquidity can be affected on the afternoon prior to data releases as well as the market open on the morning of data releases.
Bloomberg News was invited by the ONS to submit its views on the pros and cons of continuing with 7 a.m. releases, rather than the alternative time of 9.30 a.m.
“The ONS is currently reviewing its use of 7 a.m. release times, which we have used since the pandemic for market-sensitive statistics,” a spokesperson for the agency said. “We will report back to the OSR shortly.”
The ONS has said previously that 7 a.m. releases gives it an increased ability to communicate its figures clearly. It allows ONS spokespeople to “appear on morning broadcast shows to explain what our figures show and, importantly, put them in a wider context,” Mike Keoghan, a director general of the ONS, told the OSR in July.
