46/01
4 April 2001
UK OFFICIAL HOLDINGS OF INTERNATIONAL RESERVES:
Part I: UK Government Foreign Currency Assets and Liabilities - March 2001
The UK Government's net reserves fell by $477 million in March, bringing the end-March total to $13,105 million (£9,218 million [1] )] compared with $13, 582 million (£9, 418 million [2] ) at the end of February. US $ million: market values
| end February 2001 | end March 2001 | |
| Gross Reserves [3] | 42,007 | 42,902 |
| Liabilities | -28,425 | -29,797 |
| of which foreign currency forwards | -13,618 | -14,816 |
| swaps (net) [4] | ||
| repo transactions [5] | -484 | -798 |
| Net reserves [6] | 13,582 | 13,105 |
| Change in net reserves | -477 | |
| valuation effects | ||
| transactions against sterling | -9 | |
| of which | ||
| UK public sector customers | -547 | |
| Other | 538 |
As set out in the Chancellor's letter of 6 May 1997 to the Governor of the Bank of England, if the Government so instructs then the Bank, acting as its agent, may intervene in the foreign exchange market by buying or selling the government's foreign exchange reserves. If intervention is undertaken, the monthly press release will provide details of the amount and date of the intervention and an explanation of why it was undertaken. No intervention operations were undertaken in March.
Part II: Bank of England Foreign Currency Assets and Liabilities ?
March 2001
The Bank of England's net holdings of foreign currency and gold rose by $13 million in March, bringing the end-March total to $96 million (£68 million [1] ) compared with $83 million (£57 million [2] ) at the end of February.
US $ million: market values
| end February 2001 | end March 2001 | |
| Assets [3] | 8,966 | 9,180 |
| Liabilities | -8,883 | -9,084 |
| of which foreign currency forwards and | -185 | -370 |
| swaps (net) [4] Repo transactions [5] | 0 | 0 |
| Net assets [6] | 83 | 96 |
| Change in net holdings of which | 13 | |
| valuation effects | 15 | |
| transactions against sterling of which | -1 | |
| UK public sector customers | - | |
| Other | - |
As set out in the Chancellor's letter of 6 May 1997 to the Governor of the Bank of England, the Bank may also undertake foreign exchange operations to intervene in support of its monetary policy objective. If intervention is undertaken, the monthly press release will provide details of the amount and date of intervention and an explanation of why it was undertaken. No such intervention operations were undertaken by the Bank in March.
The Bank of England's foreign currency assets and liabilities arise from foreign currency and gold deposits placed with the Bank by overseas central banks and other customers, the net effect of foreign exchange swaps conducted in the course of the Bank's money market operations, UK participation in the TARGET system, the Bank's euro Bill and Notes programme, and other capital items. Foreign exchange swaps may be undertaken as a supplement to the Bank's usual money market techniques to provide sterling liquidity to the market, and are purely technical in nature. The proceeds of the Bank's euro Bills are used to finance the provision by it of intra-day liquidity, on a secured basis, to participants in CHAPS euro, as part of the arrangements for TARGET.
1. When converted at the closing market rate (4pm) of £1 = $1.4217 on 30 March 2001.
2. When converted at the closing market rate (4pm) of £1 = $1.4421 on 28 February 2001.
3. In this presentation gross reserves exclude market valuation of foreign currency forwards and swaps. These derivatives are shown (excl sterling leg) within liabilities.
4. Net present value of foreign currency forwards, interest rate and cross currency swaps (excl sterling leg).
5. Market value of liabilities to repay foreign currency received in repo transactions.
6. Figures may not sum due to roundings.
Notes to Editors
Background
1. The UK's international reserves are now being published in accordance with the methodology developed by the International Monetary Fund in the context of revisions to their Special Data Dissemination Standard (SDDS), and the G10 central banks in their report ?Enhancing transparency regarding authorities? foreign currency liquidity position?.
2. The UK began to disclose additional information on its foreign currency assets and liabilities required under the International Monetary Fund's Special Data Dissemination Standard (assets, liabilities and derivatives) from July 1999. Data for end-July 1999 onwards can be found on the link below:
Methodology and definitions
3. The Bank of England's website also provides information on the methodology now used and definitions of the main conventions employed.
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For more information about National Statistics visit the website below.
Internet version
5. If you have access to the Internet, you can find this news release and other Treasury information on this site.
Next publication date
6. The figures for April 2001 will be published on Thursday 3 May 2001.
Enquiries
7. Media enquiries about this press release should be addressed to Simon Moyse in the Treasury Press Office on 020 7270 4420.
External links
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