Data Leaks in China Give Some Investors an Edge

On Apr. 14, Hong Kong broadcaster Phoenix Satellite Television posted on its website China's March inflation rate, industrial output, and eight other key economic indicators, citing an unidentified source. When the official numbers were released that afternoon and the following day, 9 of the 10 figures posted by Phoenix turned out to be correct. Similar leaks of Chinese economic data have frequently circulated in recent months. "More often than not, we see the stock markets move strangely before the release of statistics," says Yan Yiming, a Shanghai-based securities lawyer.

Chinese authorities suspect that the leaks come from officials at various ministries and agencies that enjoy early access to the data. Now the National Bureau of Statistics of China is calling for a crackdown. "Those spreading state secrets on the Internet or other public information networks should be held accountable," bureau spokesman Sheng Laiyun told reporters in Beijing on Apr. 15.