JPMorgan, BlackRock in BLS CPI Data 'Super User' Controversy

Key Takeaway

• JPMorgan and BlackRock were among firms in contact with a BLS economist for CPI details, raising concerns about data access fairness.
• The "super user" email list facilitated exchanges on CPI computations, including shelter and used cars categories.
• The BLS aims to restore trust after an email mistake suggested unequal information access, emphasizing public data security and fairness.

Inflation Data Dissemination Controversy

An economist from the Bureau of Labor Statistics (BLS) has been found to share key US inflation data with select Wall Street firms, including JPMorgan Chase & Co. and BlackRock Inc., raising concerns over equitable access to sensitive economic information. The communications, mostly concerning the consumer price index (CPI) calculations for shelter and used cars, were revealed through records requested by Bloomberg. This has sparked a debate on the fairness and transparency of data dissemination practices, especially when such information can significantly impact market movements and Federal Reserve policy decisions.

"Super Users" Email List

The term "super users" emerged from an email chain where a BLS economist, in response to a query, confirmed adding a user to a so-called "super user email list." This list, which the BLS later clarified it does not officially maintain, seemed to include major financial institutions and hedge funds like Brevan Howard, Millennium Capital Partners LLP, and Citadel, among others. The existence of this list contradicts the BLS's stance on providing equal access to information, as it suggests a preferential treatment in sharing insights on inflation data computations.

Email Mistake and Market Impact

A particular email sent by the BLS economist in February addressed to "Super Users" explained a methodological change in the CPI's housing cost calculations, which had contributed to a notable increase in January's inflation figures. This email was later retracted by the BLS, labeling it a "mistake" and attempting to clarify the confusion through a website notice. However, the incident has led to a deeper examination of how government agencies share economic data, given its potential to influence investor decisions and Federal Reserve policies.

Management Quotes

• Emily Liddel, Associate Commissioner for Publications and Special Studies at the BLS:

  "Obviously this has been an embarrassment for the agency. The public puts a lot of trust in us to be fair, and our data providers put a lot of trust in us for the data to be secure. It’s our goal to repair that trust."