Exchange Fund Abridged Balance Sheet and Currency Board Account

The Hong Kong Monetary Authority (HKMA) announced today (September 30) that the total assets of the Exchange Fund amounted to HK$1,062.4 billion at August 31 2005.

The figure is included in the Exchange Fund Abridged Balance Sheet, which is released monthly together with the Currency Board Account.

At the end of August 2005 the total assets of the Exchange Fund, at HK$1,062.4 billion, were HK$3.9 billion higher than at the end of July 2005. Both foreign currency assets and Hong Kong dollar assets increased, by HK$2.4 billion and HK$1.5 billion respectively.

The increase in foreign currency assets was due mainly to valuation gains on foreign currency investments and income from foreign currency assets, which was partly offset by decreases in Certificates of Indebtedness and repurchase agreements outstanding. The increase in Hong Kong dollar assets was due mainly to an increase in bank borrowings, which was partly offset by fiscal drawdowns.

The Currency Board Account shows that the Monetary Base at the end of August 2005 was HK$277.6 billion, a decrease of HK$1.7 billion, or 0.6%, from the end of July 2005. The decrease was due mainly to a decrease in Certificates of Indebtedness.

The Backing Assets decreased by HK$0.6 billion, or 0.2%, to HK$309.2 billion. The decrease was attributable mainly to the corresponding decrease in Certificates of Indebtedness in the Monetary Base which was partly offset by income from investments and revaluation gains. Reflecting this, the backing ratio increased from 110.88% at the end of July 2005 to 111.36% at the end of August 2005.

Attachment
Annex 1 : Abridged Balance Sheet of the Exchange Fund
Annex 2 : Currency Board Account

At present, four press releases relating to the Exchange Fund's data are issued by the HKMA each month. Three of these releases are issued to disseminate monetary data in accordance with the International Monetary Fund's Special Data Dissemination Standard (SDDS). The fourth press release, on the Exchange Fund's Abridged Balance Sheet and Currency Board Account, is made in accordance with the HKMA's policy of maintaining a high level of transparency. For the month of September 2005, the scheduled dates for issuing the press releases are as follows:

For further enquiries, please contact:

Jasmin Fung, Manager (Press), at 2878 8246 or
Hing-Fung Wong, Resource Co-ordinator, at 2878 1802

Hong Kong Monetary Authority
30 September 2005