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2 February 1999
UK OFFICIAL HOLDINGS OF FOREIGN CURRENCY AND GOLD
Part I: UK Government Reserves - January 1999
1. The overall level of the UK Government's reserves, including the forward book, fell by $1,612 million in January, bringing the end-January total to $35,366 million (21,521 million Pounds) compared with $36,978 million (22,222 million Pounds) at the end
of December.
2. The underlying change in the reserves, including the forward book, was a fall of $3 million.
3. The underlying change excludes capital transactions that are included in the overall change. In January
- there were repayments of $2 million of Exchange Cover
Scheme (ECS) borrowing; - receipts from Government Euro Treasury Bills issued
exceeded capital repayments on those maturing by $3
million; and - capital repayments on Government Euro Treasury Notes
maturing exceeded receipts from those issued by $1,611
million.
| $ million | |||
| Spot | Forward |
Total |
|
| end-January reserves | 33,833 | 1,533 | 35,366 |
| less |
|||
| end-December reserves | 35,449 | 1,529 | 36,978 |
| OVERALL CHANGE | -1,616 | 4 | 1,612 |
| less | |||
| adjustments | 1,610 | 0 | 1,610 |
| UNDERLYING CHANGE | -7 | 4 | -3 |
4. No intervention operations were undertaken in January. Part II: Bank of England Holdings of Foreign Currency and Gold -
January
1. The overall level of the Bank of England's holdings of foreign currency and gold, including the forward book, rose by $3,983 million in January, bringing the end-January total to $7,110 million (4,327 million Pounds) compared with $3,127 million (1,879
Pounds million) at the end of December.
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2. There was no underlying change in the level of the Bank of England's holdings including the forward book.
| $ million | |||
| Spot | Forward | Total | |
| end-January holdings | 16,174 | -9,064 | 7,110 |
| less |
|||
| end-December holdings | 7,428 | -4,301 | 3,127 |
| OVERALL CHANGE | 8,746 | -4,763 | 3,983 |
| less adjustments | -8,746 | 4,763 | -3,983 |
| UNDERLYING CHANGE | 0 | 0 | 0 |
3. The adjustments to the overall change figure include the change in valuation over the month, changes in holdings arising from changes in foreign currency and gold deposits placed with the Bank by overseas central banks and other customers, changes due to
the net effect of foreign exchange swaps conducted in the course of the Bank's money market operations, and other capital items. The foreign exchange swaps are 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.
4. As noted in the previous press release, as a consequence of the United Kingdom's connection to the TARGET payments system, the Bank holds working balances in euro. Further operations to acquire euro for this purpose during January increased the Bank's spot holdings of foreign currency by approximately $1,500 million and created an equivalent forward liability.
5. The Bank's participation in the TARGET system has given rise to euro balances with other central banks operating the system. These are in effect off-set by similar balances that the other central banks hold at the Bank. As a result they are shown net in
the table above, where they account for $3,345 million. The gross amount is $79,172 million.
6. No intervention operations were undertaken in January.
Notes to Editors
1. The Quarterly Report on UK Official Holdings of Foreign Currency and Gold, to be published on 2 March 1999 and covering the quarter ending 31 December 1998, will contain further information about the foreign-currency and gold holdings of the Government and the Bank of England. This will include, for each, the currency
composition of foreign-currency assets, the size and currency composition of foreign-currency liabilities and information on intervention operations, if undertaken.
2. The Government and Bank of England figures have been produced on the basis of different accounting methodologies. Therefore, no overall total for the two is shown. Details of the accounting methodologies were included in the Quarterly Report published on 3 March 1998 (covering October-December 1997) and will be included in future Quarterly Reports.
3. The underlying change in the Government's reserves is the result of a variety of transactions, both debits and credits, including, for example, transactions for Government departments, transactions with other central banks and interest receipts and payments. For these reasons, the underlying change should not be taken as an indication of market intervention.
4. Repayments under the Exchange Cover Scheme in January were as follows:
| Organisation | $ million |
| Bradford County Council | 0.514 |
| Lothian Regional Council | 0.437 |
| Tameside Metropolitan Council | 0.420 |
| Cornwall County Council | 0.214 |
| Total | 1.585 |
5. The figures contained in this press release can also be obtained from the Reuters Monitor (page TREA), Bridge News (page 170), Telerate (p22494) and Topic (p6800).
6. As a result of the Easter public holidays the figures for March 1999 will be published on Wednesday 7 April.
7. If you have access to the Internet, you can find this information on this site and at the Bank of England site. See address below.