The Hong Kong Monetary Authority (HKMA) announced that the official foreign currency assets of Hong Kong, including those held in the Land Fund, were US$92.8 billion at the end of December 1997. At the end of November, the total size of the foreign currency assets was US$96.5 billion. In terms of foreign currency reserves ranking, Hong Kong remains the third largest in the world, after Japan and Mainland China (Table 1).
As at the end of December, the foreign currency assets held in the Exchange Fund were US$75.3 billion (end-November: US$79.1 billion) and in the Land Fund were US$17.5 billion (end-November: US$17.4 billion). The total foreign currency assets of US$92.8 billion represent about 10 times the currency in circulation or about 45% of Hong Kong dollar M3; one of the highest in the world.
The fall in foreign currency assets in December can be attributed to the decline of Hong Kong dollar interest rates in December. Short-term capital attracted to the Hong Kong dollar by high interest rates in November reversed in December, bringing reserves to the level comparable to that at the end of October (Tables 2 and 3).
"Monthly figures of the foreign currency assets are likely to show short-term variations due to seasonal and interest rate fluctuation," said an HKMA spokesman.
Including outstanding forward transactions, the foreign currency assets held in the Exchange Fund and the Land Fund were US$75.6 billion (end-November: US$79.5 billion) and US$17.6 billion (end-November: US$17.4 billion) respectively (Tables 4 and 5).
Hong Kong Monetary Authority
22 January 1998
Foreign Exchange Reserves Ranking | |||
US$BN | As at end of | ||
(1) | Japan | 220.8 | December 97 |
(2) | China | 139.9 | December 97 |
(3) | Hong Kong | 92.8* | December 97 |
(4) | Taiwan | 83.1 | November 97 |
(5) | Germany | 81.7 | November 97 |
(6) | Singapore | 74.4 | November 97 |
(7) | Spain | 69.4 | November 97 |
(8) | US | 68.5 | November 97 |
(9) | Italy | 57.5 | November 97 |
(10) | Brazil | 52.4 | October 97 |
Source: HKMA, IMF, Reuters
* Detailed breakdown at Tables 4 and 5
Foreign Currency Assets and Interest Rate Movements | ||
---|---|---|
. | End of Period Forex assets |
Average 1-month Hibor |
December 1996 | 63.8 | 5.47% |
January 1997 | 65.9 | 5.17% |
Februrary 1997 | 63.8 | 5.38% |
March 1997 | 63.4 | 5.54% |
April 1997 | 63.6 | 5.69% |
May 1997 | 66.6 | 5.97% |
June 1997 | 67.6 | 6.31% |
July 1997 | 66.1 | 6.31% |
August 1997 | 69.5 | 7.22% |
September 1997 | 71.4 | 7.49% |
October 1997 | 74.0 | 10.24% |
November 1997 | 79.1 | 9.66% |
December 1997 | 75.3 | 7.29% |
Total Foreign Currency Assets (Exchange Fund and Land Fund) |
|
---|---|
. | (US$ billion) |
End- July 97 | 81.7 |
End- August 97 | 85.3 |
End- September 97 | 88.1 |
End- October 97 | 91.4 |
End- November 97 | 96.5 |
End- December 97 | 92.8 |
Exchange Fund -- Foreign Currency Reserves (US$ billion) | |||
---|---|---|---|
. | Excluding forward transactions | Net forward transactions | Including forward transactions |
End- January 97 | 65.9 | 5.2 | 71.1 |
End- Februrary 97 | 63.8 | 4.3 | 68.1 |
End- March 97 | 63.4 | 4.3 | 67.7 |
End- April 97 | 63.6 | 4.0 | 67.6 |
End- May 97 | 66.6 | 1.8 | 68.4 |
End- June 97 | 67.6 | 2.1 | 69.7 |
End- July 97 | 66.1 | 2.5 | 68.6 |
End- August 97 | 69.5 | 0.1 | 69.6 |
End- September 97 | 71.4 | 0.3 | 71.7 |
End- October 97 | 74.0 | 0.4 | 74.4 |
End- November 97 | 79.1 | 0.4 | 79.5 |
End- December 97 | 75.3 | 0.3 | 75.6 |
Land Fund -- Foreign Currency Reserves (US$ billion) | |||
---|---|---|---|
. | Excluding forward transactions | Net forward transactions | Including forward transactions |
End- July 97 | 15.6 | 0.1 | 15.7 |
End- August 97 | 15.8 | 0.1 | 15.9 |
End- September 97 | 16.7 | 0.4 | 17.1 |
End- October 97 | 17.4 | (0.1) | 17.3 |
End- November 97 | 17.4 | 0 | 17.4 |
End- December 97 | 17.5 | 0.1 | 17.6 |
Note: The Land Fund was established on 1 July 1997. Figures prior to that date are therefore not available