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5 December 2000

UK OFFICIAL HOLDINGS OF INTERNATIONAL RESERVES:

Part I: UK Government Foreign Currency Assets and Liabilities - November 2000

1. The UK Government's net reserves fell by $9 million in November, bringing the end-November total to $13,251 million (£9,344 million1) compared with $13,259 million (£9,131 million2) at the end of October.

US $ million: market values
end October 2000 end November 2000

Gross Reserves3

 43,480 46,315

Liabilities

 -30,221 -33,065

of which

foreign currency forwards and

swaps (net)4

 -11,177 -11,977
repo transactions5 -1,379 -2,606
Net reserves6
 13,259 13,251
Changes in net reserves
 -9
of which
valuation effects 3
transactions against sterling -12
of which
UK public sector customers -266
Other 254

2. 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 November.

Part II: Bank of England Foreign Currency Assets and Liabilities - November 2000

The Bank of England's net holdings of foreign currency and gold rose by $6 million in November, bringing the end-November total to $84 million (£59 million1) compared with $78 million (£54 million2) at the end of October.

US $ million: market values
end October 2000 end November 2000

Assets3

 7,862 8,211

Liabilities

 -7,785 -8,127

of which

foreign currency forwards and

swaps (net)4

 20 12
repo transactions5 0 0
Net assets6
 78 84
Changes in net holdings
 6
of which
valuation effects 6
transactions against sterling 0
of which
UK public sector customers -
Other -

2. 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.

3. 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 programme, 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. 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 = $1.4182 on 30 November 2000.
2 When converted at the closing market rate (4pm) of £1 = $1.4521 on 31 October 2000.
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

External links

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.

External links

Next publication date

5. The figures for December 2000 will be published on Thursday 4 January 2001.

Enquiries

6. Media enquiries about this press release should be addressed to Charles Keseru in the Treasury Press Office on: 020 7270 5188.

7. Public enquiries (non-media) about this press release should be addressed to the Treasury's Public Enquiry Unit on:

Telephone: 020 7270 5188 Fax: 020 7270 4574

National Statistics Public Enquiry Service

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

Telephone: 020 7533 5888

minicom: 01633 812399

Fax: 01633 652747

Letters: Room DG/18, 1 Drummond Gate, LONDON SW1V 2QQ