Exchange Fund Abridged Balance Sheet and Currency Board Account

The Hong Kong Monetary Authority (HKMA) announced today (Friday) that the total assets of the Exchange Fund amounted to HK$1,052.6 billion at 31 October 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 October 2005 the total assets of the Exchange Fund, at HK$1,052.6 billion, were HK$12.5　billion lower than at the end of September 2005. Both foreign currency assets and Hong Kong dollar assets decreased, by HK$5.8 billion and HK$6.7 billion respectively.

The decrease in foreign currency assets was due mainly to a decrease in Certificates of Indebtedness and valuation losses on foreign currency investments, which were partly offset by income from foreign currency assets and an increase in repurchase agreements outstanding. The decrease in Hong Kong dollar assets was due mainly to a decrease in bank borrowings and valuation losses in the market value of Hong Kong equities held by the Exchange Fund, which were partly offset by placements received from fiscal reserves.

The Currency Board Account shows that the Monetary Base at the end of October 2005 was HK$278.2 billion, a decrease of HK$2.5 billion, or 0.9%, from the end of September 2005. The decrease was due mainly to a decrease in Certificates of Indebtedness.

The Backing Assets decreased by HK$2.3 billion, or 0.7%, to HK$309.6 billion. The decrease was attributable mainly to the corresponding decrease in Certificates of Indebtedness in the Monetary Base, which was partly offset by net income from investments. Reflecting this, the backing ratio increased from 111.12% at the end of September 2005 to 111.29% at the end of October 2005.

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

For further enquiries, please contact:
Kevin Ip, Manager (Press), at 2878 1687 or
Thomas Chan, Senior Manager (Press), at 2878 1480

Hong Kong Monetary Authority
25 November 2005

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 November　2005, the scheduled dates for issuing the press releases are as follows: