The US could end media lockups for economic data releases

Author: Adam Button | Category: News

That would tilt the field further towards quants

The US plans to restrict computers from media lockups for major economic data reports, according to a Bloomberg report.

In virtually all major economies, media are locked in a room with the internet connection turned off an cellphones taken away where they are allowed to see and prepared economic data releases for 30-60 minutes before release. At exactly the release time, the internet is turned back on and the data is transmitted.

The US is considering removing computers from the room altogether, which would then likely be available first on US government websites. That would create an arms race where quants located closest to US government servers could obtain a considerable advantage. It also creates a new risk of those websites failing under load.

The announcement could come this week, according to Bloomberg.

Under the current system all newswire clients get the data at the same time. If government websites are used, they are generally powered by the TCP data-transmission protocol, which sends the info to whoever gets to the website first.

I'm eager to see how this unfolds. For retail traders, newswires will still probably be best. Because like with earnings releases, they can build machines that scrape and publish data. However quants will invest in frontrunning that.

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