Hong Kong Monetary Authority Reports Slight Decline in Exchange Fund Assets

Exchange Fund Assets Overview

The Hong Kong Monetary Authority (HKMA) announced that the total assets of the Exchange Fund amounted to HK$4,062.9 billion as of April 30, 2024. This marks a slight decrease of HK$0.9 billion compared to the end of March 2024, according to the HKMA's official website.

Foreign Currency and Hong Kong Dollar Assets

The decline in total assets was attributed primarily to a decrease in foreign currency assets by HK$82.4 billion, offset by an increase in Hong Kong dollar assets by HK$81.5 billion. The HKMA noted that the reduction in foreign currency assets resulted from mark-to-market revaluation of investments and a reduction in the month-end balances of unsettled securities purchases. In contrast, the rise in Hong Kong dollar assets was primarily due to the issuance of Exchange Fund Bills and Notes that had not yet been settled by month-end.

Currency Board Account

The Currency Board Account revealed that the Monetary Base at the end of April 2024 was HK$1,916.2 billion, a decrease of HK$2.0 billion, or 0.1%, from March 2024. This drop was mainly due to a reduction in the outstanding amount of Certificates of Indebtedness, partially offset by the amortization of discounts on Exchange Fund Bills and Notes.

Backing Assets and Backing Ratio

The amount of Backing Assets decreased by HK$8.5 billion, or 0.4%, to HK$2,123.0 billion at the end of April 2024. The HKMA attributed this decrease to the redemption of Certificates of Indebtedness and the mark-to-market revaluation of investments, partially offset by interest from investments. Correspondingly, the Backing Ratio fell from 111.12% at the end of March 2024 to 110.79% at the end of April 2024.

Transparency and Reporting

The HKMA issues four press releases each month related to the Exchange Fund’s data, three of which are in accordance with the International Monetary Fund’s Special Data Dissemination Standard (SDDS). The fourth press release, covering the Exchange Fund’s Abridged Balance Sheet and Currency Board Account, is part of the HKMA's commitment to maintaining a high level of transparency.

The scheduled dates for the HKMA's press releases in May 2024 were as follows:

• 7 May - SDDS International Reserves
• 14 May - SDDS Analytical Accounts of the Central Bank
• 31 May - SDDS Template on International Reserves and Foreign Currency Liquidity
• 31 May - Exchange Fund Abridged Balance Sheet and Currency Board Account

For more details, visit the official HKMA website.