Exchange Fund Abridged Balance Sheet and Currency Board Account

The Hong Kong Monetary Authority (HKMA) announced today (Wednesday) that the total assets of the Exchange Fund amounted to HK$1,074.1　billion as at 28 February 2001.

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

At the end of February 2001, the total assets of the Exchange Fund, at HK$1,074.1 billion, were HK$1.3 billion lower than at the end of January 2001. Foreign currency assets increased by HK$20.3 billion while Hong Kong Dollar assets decreased by HK$21.6 billion.

The increase in foreign currency assets was mainly due to an increase in the amount of repurchase agreements outstanding and valuation gains on foreign currency investments, which were partly offset by a decrease in currency notes outstanding.

The decrease in Hong Kong dollar assets was mainly due to decreases in the market value of Hong Kong equities held by the Exchange Fund and placements by other government funds.

Figures in the Currency Board Account show that the monetary base at the end of February 2001 was HK$217 billion, a decrease of HK$10.8 billion, or 4.8%, from the end of January 2001. The decline was mainly due to a decrease in Certificates of Indebtedness of HK$11.3 billion, mainly reflecting reduced demand for cash after the Lunar New Year.

The backing assets decreased by HK$15.8 billion, or 6.2%, from HK$255　billion to HK$239.2 billion. The decline was mainly due to (i) the corresponding decrease in Certificates of Indebtedness in the monetary base and (ii) a transfer of assets out of the Backing Portfolio to the Investment Portfolio as the backing ratio surpassed the upper trigger level in February, in accordance with the arrangement approved by the Exchange Fund Advisory Committee in January 2000. Reflecting these factors, the backing ratio decreased from 111.92% at the end of January to 110.23% at the end of February.

Attachment

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

For further enquiries, please contact:

Jasmin Fung, Manager (Press), at 2878 8246 or
Caitlin Wong, Manager (Press), at 2878 1687

Hong Kong Monetary Authority
28 March 2001

At present, four press releases relating to the Exchange Fund's data are issued 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 March, the scheduled dates for issuing the press releases are as follows: