UK official holdings of international reserves

London, 4 June/GNN/ -- HM TREASURY News Release (PN 53/08) issued by The Government News Network on 4 June 2008 Part I: UK Government Foreign Currency Assets and Liabilities - May 2008

1. UK Government net reserves fell by $97 million in May 2008, bringing the
end-May total to $25,882 million (=A313,097 million1) compared with $25,979
million (=A313,119 million2) at end-April 2008.

US $ million: market values

End April End May 2008
2008

Gross Reserves3 61,416 60,642

Liabilities -35,437 -34,760

of which

foreign currency -21,344 -20,691
forwards and swaps
(net)4

repo transactions5 -9,454 -9,550

Net reserves6 25,979 25,882

Change in net reserves -97

of which

valuation effects -96

transactions against -1
sterling

of which

UK public sector -979
customers

Other 978

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, the Bank, acting as its
agent, may intervene in the foreign exchange market by buying or selling
Government 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 May.

Part II: Bank of England Foreign Currency Assets and Liabilities - May 2008.
1. Bank of England net holdings of foreign currency and gold rose by $4
million in May 2008, bringing the end-May total to $3 million (=A31.6 million1)
compared with -$1 million (-=A30.3million2) at end-April 2008.

US $ million: market values

End April 2008 End May
2008

Assets3, 35,851 29,864

Liabilities -35,852 -29,861

of which

foreign currency forwards -6,095 -4,249
and swaps (net)4

repo transactions5 -160 -160

Net assets6 -1 3

Change in net holdings 4

of which

valuation effects -17

transactions against 21
sterling

of which

UK public sector customers -
Other 21

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. The Bank
undertook no such intervention operations in May.

3. Bank of England foreign currency assets and liabilities mainly arise
from the Bank's foreign exchange reserves, deposits placed with the Bank by
overseas central banks and other customers, assets to facilitate the UK's
participation in the TARGET system and other capital items.

1. When converted at a closing market rate of =A31 $1.9762 on 30 May.

2. When converted at a closing market rate of =A31 $1.9802 on 30 April.

3. In this presentation gross reserves in part 1 and assets in part 2 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 rounding.

Source: HM Treasury

2008-06-04 04:39:05 0376855 PRNEWSWIRE