BOE Stops Private Investor Briefings After Morgan Stanley Event
BOE Stops Private Investor Briefings After Morgan Stanley Event
(Bloomberg) -- The Bank of England will cease off-the-record briefings between members of its rate-setting committee and individual private financial institutions.
The move is deemed a permanent step toward improving transparency, a BOE spokesman said on Wednesday.
The decision comes a week after the BOE’s Deputy Governor Ben Broadbent attended a roundtable hosted by Morgan Stanley following the central bank’s policy decision on Sept. 23.
While it’s not uncommon for central banks to hold regular meetings with private investors, the practice has attracted considerable controversy recently, with critics saying it gives the impression that bigger firms are gaining exclusive access to information.
Morgan Stanley declined to comment.
Market bets on a BOE rate hike in December briefly dipped on the morning of Oct. 7 when speculation about the meeting was swirling.
Brad Bechtel, global head of FX at Jefferies, said there were “rumors of a Broadbent speech” last week in which he appeared to push back against expectations of an interest-rate hike in November.
The central bank said the deputy governor had provided no information that was not publicly available in the minutes of the September meeting and expressed frustration that misrepresentations of his comments were circulating in financial markets.
Allan Monks, an economist at JPMorgan Chase & Co., wrote in a report that “Broadbent is speculated to have pushed back on a November hike due to a desire to see more jobs data, although that would still leave the subsequent meeting live.”
The decision by the BOE, which routinely holds a briefing for a group of private economists following major policy decisions, was first reported by Reuters.
It comes as some of the world’s major central banks are coming under more pressure to improve transparency.
The European Central Bank has also come under criticism for calls chief economist Philip Lane has held with analysts after its policy decisions.
The ECB said the decision to start regular briefings was taken in September 2019 and implemented in March 2020, to hear the views of economists and address any technical questions. They only touch on public information and their only focus is on the policy decision published beforehand, according to the central bank.
The ECB calls, however, marked a departure from tighter rules of engagement introduced in 2015 after a board member gave a closed-door speech to financial-market participants at a dinner that revealed changes to its bond-buying program.
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