138/01

5 December 2001

UK OFFICIAL HOLDINGS OF INTERNATIONAL RESERVES:

Part I: UK Government Foreign Currency Assets and Liabilities - November 2001

1. The UK Government's net reserves fell by $88 million in November, bringing the end-November total to $13,582 (£9,525 million¹) compared with $13,670 (£9,401 million²) at the end of October.

	US $ million: market values
	end October 2001		end November 2001
Gross Reserves³	40,407		40,682
Liabilities	-26,738		-27,100
of which
foreign currency forwards and swaps (net)⁴	-16,067		-16,127
repo transactions⁵	-193		-528
Net reserves⁶	13,670		13,582
Change in net reserves		-88
of which
valuation effects		-80
transactions against sterling		-8
of which
UK public sector customers		-135
Other		127

Part II: Bank of England Foreign Currency Assets and Liabilities - November 2001

The Bank of England's net holdings of foreign currency and gold rose by $4 million in November, bringing the end-November total to $41 million (£29 million¹) compared with $38 million (£26 million²) at the end of October.

	US $ million: market values
	end October 2001*		end Nov 2001
Assets³	9,887		9,803
Liabilities	-9,849		-9,761
of which
foreign currency forwards and swaps (net)⁴	-833		-768
repo transactions⁵	-		-400
Net assets⁶	38		41
Change in net holdings		4
of which
valuation effects		2
transactions against sterling		2
of which
UK public sector customers		-
Other		2

* Revised figures; see paragraph 2 below.

Revisions to previously published figures

2.The previously published end-month figures for the Bank of England's net holdings of foreign currency and gold for October 2001 have been revised. These revisions along with the consequential revisions to the end-month net assets figure and the change between months in the level of net assets are detailed below.

	US $ million: market values
	Published	Revised	Variance
Assets	9,886	9,887	+1
Liabilities	-9,797	-9,849	-52
foreign currency forwards and swaps (net)	-833	-833	-
Repo transactions	-	-	-
Net assets	90	38	-52
Change in net reserves #	-4	-56	-52
of which
valuation effects	-8	-60	-52
transactions against sterling	4	4	-
of which
UK public sector customers	-	-	-
Other	4	4	-

# Change from the September levels.

3. 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 November

4. The Bank of England's foreign currency assets and liabilities arise from banking 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 = $1.4260 on 30 November 2001.

2 When converted at the closing market rate (4pm) of £1 = $1.4541 on 31 October 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 Bank of England's website at www.bankofengland.co.uk/statistics/reserves.

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.

A National Statistics publication

4. National Statistics is the official source for authoritative, accurate and relevant information on the economy and society. It brings together a vast range of statistical information overseen by the National Statistician. The National Statistics logo is your assurance of statistics produced to the highest professional standards. For more information visit the National Statistics website.

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 December 2001 will be published on Friday 4 January 2002.

Enquiries

7. Media enquiries about this press release should be addressed to Simon Moyse in the Treasury Press Office on 020 7270 4420.

8. Public enquiries (non-media) about this press release should be addressed to the Treasury's Public Enquiry Unit on
Telephone: 020 7270 4558
Fax: 020 7270 4574
Email Public Enquiries

9. For general enquiries about National Statistics, contact the National Statistics Public Enquiry Service on

Telephone: 020 7533 5888
minicom: 01633 812399
Email National Statistics Information

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