The total assets of the Exchange Fund amounted to $989.5 billion in May, $10.4 billion higher than April, the Hong Kong Monetary Authority announced today.

Foreign-currency assets and Hong Kong dollar assets swelled by $4.9 billion and $5.5 billion respectively.

Income from foreign-currency assets and valuation gains on foreign-currency investments led to the growth in foreign-currency assets.

The surge in Hong Kong dollar assets was mainly due to purchase of Hong Kong dollars from foreign currencies and valuation gains in the market value of Hong Kong equities held by the Exchange Fund, which were partly offset by fiscal drawdowns.

In the Currency Board Account, $252.7 billion was recorded for the monetary base, an increase of $900 million or 0.4% from April. 

This was caused by an increase in Certificates of Indebtedness of $300 million and the market value of Exchange Fund Bills and Notes issued of $600 million.

The backing assets went up by $1 billion or 0.4%, from $282.1 billion to $283.1 billion. The increase was due to the corresponding increase in Certificates of Indebtedness in the monetary base and income from investments together with revaluation gains. At the end of May, the backing ratio remained virtually unchanged at 112.04%.