The Bureau of Labor Statistics will release major economic indicators such as the employment rate an hour earlier to prevent leaks of the numbers to some investors who use the knowledge to speculate in the stock market.
Julius Shiskin, commisioner of labor statistics, said in an interview yesterday that "over the last six eight months there have been lots of charges that there were leaks of the major economic indicators."
While the Labor Department has not been able to confirm tha leaks, Shiskin said he thought the prudent thing to do was release the material at 9 a.m. rather than giving it to the press and selected government officials at 9 a.m. with an embargo for public release until 10 a.m.
Shiskin said that many persons have charged that certain investors were leaked the numbers between 9 a.m. and 10 a.m. At 10 a.m., the opening bell sounds at most of the nation's stock exchanges, including the New York, American and Midwest.
These investors then place buy or sell orders, speculating on the impact the announcement of the numbers will have on early trading.
The President and the chairman of the Council of Economic Advisers are given the major economic indicators a day before they are announced. The indicators involved are the unemployment rate, the consumer price index and the wholesale price index.
At 9 a.m. on the day they are released, the major economic indicators are made available at the Labor Department and the White House to members of the press. The Scretaries of Labor, Commerce and Tresury as well as the director of the Office of Management and Budget are also permitted one copy at 9 a.m.
Shiskin said it would be fruitless to investigate the allegations. "Where would we start? It could be a typist, a transmision clerk," he said.
He said the agency decided it would be better to adopt a procedure that makes impossible leaking inside information to stock market investors.
Prior knowledge of a major economic indicator would be most valuable if the report was different than most experts expected. if the indicator is better, the market might rise in early trading, while if the statistic is worse than anticipated, the market would likely fall.