The Hong Kong Monetary Authority (HKMA) announced that the official foreign currency assets of Hong Kong were US$96.7 billion at the end of February 1998 (end-January: US$98.1 billion). In terms of foreign currency reserves ranking, Hong Kong remains the third largest in the world, after Japan and Mainland China. (Table 1).
The foreign currency assets are held in the Exchange Fund and the Land Fund. As at the end of February, the foreign currency assets held in the Exchange Fund were US$78.6 billion (end-January: US$80.3 billion) and the Land Fund were US$18.1 billion (end-January: US$17.8 billion). The total foreign currency assets of US$96.7 billion represent about seven times the currency in circulation or about 45% of Hong Kong dollar M3, one of the highest ratios in the world.
The fall in foreign currency assets held in the Exchange Fund can be attributed to the reversal in the note issuing activities in February after the end of the Chinese New Year holiday which fell in late January this year. The demand for and hence the issue of new banknotes reached its peak usually during the Chinese New Year. The issuance of new notes must be backed by US dollars which are deposited by the note issuing banks with the Exchange Fund.
"Monthly figures of the foreign currency assets are likely to show short-term variations due to seasonal factors," said an HKMA spokesman.
Including outstanding forward transactions, the foreign currency assets held in the Exchange Fund and the Land Fund were also US$78.6 billion (end-January: US$80.3 billion) and US$18.1 billion (end-January: US$17.8 billion) respectively (Table 2 and 3).
Hong Kong Monetary Authority
26 March 1998
TABLE 1
| Foreign Exchange Reserves Ranking |
| - | - | US$BN | As at end of |
| (1) |
Japan |
223.1 |
February 1998 |
| (2) |
China |
140.3 |
February 1998 |
| (3) |
Hong Kong |
96.7* |
February 1998 |
| (4) |
Taiwan |
84.0 |
January 1998 |
| (5) |
Germany |
81.3 |
January 1998 |
| (6) |
US |
71.3 |
January 1998 |
| (7) |
Spain |
68.6 |
January 1998 |
| (8) |
Singapore |
68.3 |
January 1998 |
| (9) |
Italy |
55.3 |
January 1998 |
| (10) |
Brazil |
51.0 |
December 1997 |
Source: HKMA, IMF, Reuters
* Detailed breakdown at Tables 2 and 3
TABLE 2
| Exchange Fund -- Foreign Currency Reserves (US$ billion) |
| . | Excluding forward transactions | Net forward transactions | Including forward transactions |
End-
January 1997 |
65.9 |
5.2 |
71.1 |
End-
Februrary 1997 |
63.8 |
4.3 |
68.1 |
End-
March 1997 |
63.4 |
4.3 |
67.7 |
End-
April 1997 |
63.6 |
4.0 |
67.6 |
End-
May 1997 |
66.6 |
1.8 |
68.4 |
End-
June 1997 |
67.6 |
2.1 |
69.7 |
End-
July 1997 |
66.1 |
2.5 |
68.6 |
End-
August 1997 |
69.5 |
0.1 |
69.6 |
End-
September 1997 |
71.4 |
0.3 |
71.7 |
End-
October 1997 |
74.0 |
0.4 |
74.4 |
End-
November 1997 |
79.1 |
0.4 |
79.5 |
End-
December 1997 |
75.3 |
0.3 |
75.6 |
End-
January 1998 |
80.3 |
- |
80.3 |
End-
February 1998 |
78.6 |
- |
78.6 |
TABLE 3
| Land Fund -- Foreign Currency Reserves (US$ billion) |
| . | Excluding forward transactions | Net forward transactions | Including forward transactions |
End-
July 1997 |
15.6 |
0.1 |
15.7 |
End-
August 1997 |
15.8 |
0.1 |
15.9 |
End-
September 1997 |
16.7 |
0.4 |
17.1 |
End-
October 1997 |
17.4 |
(0.1) |
17.3 |
End-
November 1997 |
17.4 |
0 |
17.4 |
End-
December 1997 |
17.5 |
0.1 |
17.6 |
End-
January 1998 |
17.8 |
- |
17.8 |
End-
February 1998 |
18.1 |
- |
18.1 |
Note: The Land Fund was established on 1 July 1997. Figures prior to that date are therefore not available
