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DRAFT TELEGRAM TO GOVERNOR, HONG KONG
Your telegram No 1361.
2. On the basis of your tel. No 983, taken in conjunction with paras 5 and 10 of your tel. No 1117, we have assumed that you were content to continue with the conventional book valuation basis. This was acceptable to us since it is based on CR 230 and can thus be regarded effectively as statutory for the purpose of para 6(3)(b) of the declaration.
30 However, in the special circumstances that you have described, we are willing to agree that Hong Kong's minimum sterling holding should be calculated on the basis of
We are market price as determined on each reporting date. thus prepared to take as starting point the sterling figure for 26 September of £313 million, giving an MSP of 78 per
cent.
4.
Acceptance of market valuation for the calculation of minimum sterling holdings means of course that this basis would be used in the calculation of any implementation
payment became due.