Exchange Fund Abridged Balance Sheet and Currency Board Account

The Hong Kong Monetary Authority (HKMA) announced today (Monday) that the total assets of the Exchange Fund amounted to HK$1,448.6 billion on 31 May 2008.

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 May 2008 the total assets of the Exchange Fund, at HK$1,448.6 billion, were HK$19.1 billion lower than at the end of April 2008.  Foreign currency assets decreased by HK$5.8 billion and Hong Kong dollar assets decreased by HK$13.3 billion.

The decline in foreign currency assets was due mainly to valuation losses on foreign currency investments, which was partly offset by interest and dividend income from foreign currency assets.

The decline in Hong Kong dollar assets was due mainly to valuation losses on Hong Kong equities held by the Exchange Fund and fiscal drawdowns.

The Currency Board Account shows that the Monetary Base at the end of May 2008 was HK$325.2 billion, a decrease of HK$1.1 billion, or 0.3%, from the end of April 2008.  The decline was due mainly to decreases in Certificates of Indebtedness and the market value of Exchange Fund Bills and Notes outstanding.

The Backing Assets decreased by HK$1.8 billion, or 0.5%, to HK$356.7 billion.  The decrease was attributable mainly to the redemption of Certificates of Indebtedness in the Monetary Base and revaluation losses, which were partly offset by interest from investments.  Reflecting this, the backing ratio declined from 109.91% at the end of April 2008 to 109.70% at the end of May 2008.

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

For further enquiries, please contact:
Thomas Chan, Senior Manager (Press), at 2878 1480 or
Lilian Goh, Officer (Press), at 2878 8246

Hong Kong Monetary Authority
30 June 2008

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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 June 2008, the scheduled dates for issuing the press releases are as follows: