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RBNZ axes lock-ups after leak

NZ NewswireNZ Newswire 14/04/2016

The Reserve Bank of New Zealand is axing its media and analysts' lock-ups ahead of interest rate and policy announcements after a reporter leaked details earlier this year.

A Newshub reporter gave the March 10 decision of a 25 basis point cut in the official cash rate to people in the newsroom, and it was then passed on to an economics blogger before the embargo had lifted, the central bank said on Thursday.

The blogger, Michael Reddell, said he got an email about 55 minutes before it was officially released and when the cut was confirmed he informed the bank.

Investigations by both Mediaworks and Deloittes confirmed the email trail.

The information had no material affect on markets but the breach was serious enough for the bank to make changes, said Governor Graeme Wheeler.

From April 28 the lock-ups - which allowed reporters and analysts time to prepare their reports - will be replaced with official statements.

"The leak is a serious and disappointing breach of many years of trust. It created the opportunity for improper gain on financial markets and damage to the integrity of the bank's communications."

Mr Wheeler noted that several people knew the OCR decision ahead of time but didn't alert the bank immediately.

That was irresponsible "and left open a significant risk that the bank could have closed down quickly with an immediate official release", he said.

The news did not go down well with one analyst, ANZ chief economist Cameron Bagrie tweeted: "One twit stuffs it for all".

MediaWorks, which owns Newshub, says it admitted the leak to the bank and has issued a public apology.

They had failed to follow proper process and changes had already been made, said acting chief news officer Richard Sutherland.

"We are addressing the breach with those concerned and new policies and training will be implemented."

The bank looked into other ways to release the information, but none completely mitigated the technology and human risks, said communications manager Mike Hannah.

Most central banks did not provide embargoed lock-ups. "The few that provide embargoed lock-ups for media representatives take extensive measures to control the media environment in the lock-up that are not viable for us."


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