Business

Markets on alert for UK's new Super Thursday of economic data

Mark Carney Image copyright Getty Images
Image caption Mark Carney says the changes will enhance the Bank's transparency

Markets are on alert ahead of the UK's new economic touchstone, a Super Thursday of economic data.

From this Thursday, the monthly rate decision and the minutes of the Bank's Monetary Policy Committee (MPC) meeting will be released together, without the normal fortnightly gap.

Many see the new date as similar to the US's most important monthly release, the non-farm payrolls.

But some say it is information overload.

Both are key indicators for the whole economy.

Every three months Super Thursday will also coincide with the release of the Bank's quarterly inflation report.

This lunchtime, the Bank of England is releasing these three core items of economic data.

  • A decision on interest rate levels in the UK
  • The minutes of the MPC- crucially the voting decisions that made the decision
  • The Bank's quarterly Inflation Report

Review

Mark Carney, the Bank of England governor, says bringing these three announcements together will "enhance our transparency and make us more accountable to the British people".

Super Thursday is the result of a review published in December by Governor Kevin Warsh, a former member of the Federal Reserve System, into the MPC's transparency.

He said: "Members often find themselves in the uncomfortable position of necessarily obfuscating their views in public in the two-week gap between the policy meeting and the publication of the minutes.

"This also leads to a blizzard of communications from MPC members in the short period between the release of the minutes and the 'purdah' period for the next policy meeting."

Image copyright PA

Overkill?

But the reform has not been greeted with universal enthusiasm. Some believe that with all the attention on the voting and the decision of the MPC, important data in the Inflation Report will be ignored.

Larry Elliott, economics editor of the Guardian newspaper, called Super Thursday a "data dump" and said: "The information overload will make it harder not easier for the Bank's thinking to be scrutinised."

Philip Aldrick, of The Times newspaper, says there will be too much information for the markets to absorb "cleanly".

"Wrapping up the Inflation Report with the rate decision and minutes is overkill".

Former MPC member Andrew Sentance told the BBC that the MPC minutes were now being "rushed out".

It used to be that the minutes would be published two weeks after the interest rate decision was made.

Instead of taking two weeks to draft and re-draft the minutes it will now be done in just 18 hours, Mr Sentance said, and he is worried that the minutes will "not be as informative" as they could be.

There used to be two rounds of drafts, and members of the MPC would then comment and meet to agree the final version of the minutes. To condense that to 18 hours is putting a lot of pressure on the committee and Bank staff, Mr Sentance said.

As for the contents of the MPC minutes, many analysts are expecting them to show that two or possibly three policymakers voted for a rate rise this month.

Steven Saywell, global currency strategist at BNP Paribas, told the BBC he expects three MPC members to have backed an increase.

He added: "I think the market is behind the timing of an interest rate rise. February next year is likely. Markets have been pricing in next May."

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