From 1 March 2020, journalists who cover the release of key US economic data will only be allowed to bring pens and paper, instead of computers, to the traditional “lock-ups” that allow news people time to accurately prepare articles before the official announcement is made.
Here’s how they work: journalists go into the lock-up with computers but no internet connection 30 to 60 minutes before the data is published on a government website. This gives them time to write stories and double-check things with officials. Crucially, the lock-up process allows journalists to write stories and fact boxes that are accurate. In the case of news agencies such as Thomson Reuters and Bloomberg, “news flashes” or “snaps” display the main details and precede a full story. On the basis of those flashes, traders in the financial markets make decisions and press buttons to buy or sell assets – such as gold, currencies, bonds, oil or equities – at certain prices.I’m okay with the present situation.
Journalists entering US lock-ups will have to brush up on their penmanship and, when the embargo is lifted, presumably call their desks to shout the data down the phone line. This raises the potential for error.Traders may have to go to the government website to read the full release, losing crucial seconds in the trading process. This could give an unintentional advantage to funds that make use of computer programmes to instantly make sense of data and trade accordingly.
There might be unexpected silver linings to this move, one that was initially mooted by the previous Obama administration. It has not come straight out of the blue and South African authorities might be prompted to reconsider their lock-up system.Michael Bloomberg, founder and majority owner of Bloomberg, is a candidate in the race for the Democratic Party’s presidential nomination in the November election – to stand against White House incumbent Trump.