Wall Street analysts ripped the federal government after it issued the largest downward revision of jobs data in 15 years this week — and botched the release in the process, sowing chaos across the stock and bond markets.
The Bureau of Labor Statistics was scheduled to release its annual “preliminary benchmark revision” at 10 a.m. Eastern time on Wednesday.
The report, which said that 818,000 fewer jobs were created in the 12 months through March of this year, came out more than half an hour late.
Normally the benchmark revision is of interest to a niche group of economic analysts, but this year’s report warranted much higher scrutiny as Wall Street was looking for signs that the labor market was cooling — a development that would likely push the Federal Reserve to begin slashing interest rates sooner.
Analysts who were eager to get their hands on the revised data, which Commerce Secretary Gina Raimondo initially called “misinformation” from former President Donald Trump, then called BLS, which provided the numbers to a select few firms, according to Bloomberg News.
BNP Paribas, the French multinational banking giant, and Mizuho Financial Group, the Japanese lender, were among the first to get their hands on the data while others were kept in the dark, it was reported.
It took BLS more than 30 minutes for it to release the report, but by that time rumors were flying around the street about the precise numbers of jobs lost.
Andrew Brenner, head of international fixed income at NatAllianceSecurities, sent a mass email to clients saying that the downward revised number was actually 676,000 — a figure he had heard from an analyst on CNBC.
“Then about 10 minutes later, everyone corrected me,” Brenner told Bloomberg News.
He said the government was “using backward systems and I don’t think they have a clue as to how important some of these numbers are.”
Brenner said that traders were making money off of the accurate data that was only available to a select few before BLS finally released the figures — as evidenced by wild fluctuations in some parts of the Treasuries markets as well as a surge in the bond markets.
When asked if the leaked data helped those in possession of it turn a profit while others missed the boat, Brenner told Bloomberg News: “No question about it.”
“It’s just atrocius,” Glen Capelo, managing director at Mischler Financial Group, told Bloomberg News when asked about the botched release of the report.
Claudi Sahm, chief economist at New Century Advisors, said “there’s a big problem” with BLS.
“The fact that this was a number that had been talked about, they knew it was important and then to flub it like this,” said Capelo.
This is the second time this year that BLS made an error in publishing highly anticipated economic statistics.
In May, the agency inadvertently published inflation figures 30 minutes prior to its scheduled 8:30 a.m. Eastern time release.
In late 2022, Wall Street analysts speculated that someone at BLS leaked inflation data before its release, sending stock futures surging.
The Post has sought comment from BLS.
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