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$3,014.1 billion as at 31 January 2014, HK$15.9 billion lower than that at the end of December 2013.  Foreign currency assets decreased by HK$11.3 billion and Hong Kong dollar assets decreased by HK$4.6 billion.

The decline in foreign currency assets was mainly due to reduced holding of foreign currency deposits, valuation losses on foreign currency investments and a decrease in unsettled purchases of securities.  These decreases were partly offset by an increase in foreign currency assets connected with the issuance of additional Certificates of Indebtedness.  The decline in Hong Kong dollar assets was mainly due to a decrease in Exchange Fund Bills and Notes issued but not yet settled, mark-to-market loss on Hong Kong equities and a decrease in unsettled purchases of securities.  These decreases were partly offset by placements received from Fiscal Reserves. 

The Currency Board Account shows that the Monetary Base at the end of January 2014 was HK$1,280.4 billion, increased by HK$24.6 billion, or 2.0%, from the end of December 2013.  The rise was due to an increase in the outstanding amount of Certificates of Indebtedness, which reflected the seasonal demand for banknotes around Lunar New Year.

The amount of Backing Assets increased by HK$28.3 billion, or 2.1%, to HK$1,377.2 billion.  The rise was attributable to an increase in assets connected with the issuance of additional Certificates of Indebtedness and revaluation gains.  The backing ratio increased from 107.41% at the end of December 2013 to 107.56% at the end of January 2014.

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

Hong Kong Monetary Authority
28 February 2014

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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 February 2014, the scheduled dates for issuing the press releases are as follows: