Reserve Bank investigating alleged leak of OCR decision

by NZ Adviser23 Mar 2016

The Reserve Bank of New Zealand has confirmed that it is investigating an alleged leak of the cash rate cut on March 10 ahead of its official release. 

According to Fairfax Media, Michael Reddell, a former senior economist at the Reserve Bank claims he was told that the official cash rate would be cut an hour before the decision was announced.

"We are aware of an allegation that information may have been leaked ahead of the OCR announcement on 10 March," a spokesman of the bank said. 

"While we have no evidence at this stage that any information was leaked, we take the integrity and security of market-sensitive information very seriously and have initiated an external investigation into the allegation."

Reddell said that he did not disclose to those conducting the investigation who exactly contacted him.

"I have told them that A, it wasn't someone inside the bank and B, it wasn't someone in the lockup at the time," Reddell said, confirming later that the person who told him was not a market participant.

The market had not expected a cut to the OCR until June and holding the information in advance of its release could be highly valuable for those in currency trading.

The New Zealand dollar fell sharply after the OCR announcment was officially made but there is no evidence that there was any advance knowledge of the decision by currency traders, with the dollar holding steady until 9am.

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