April May..... June
July
August
September
A 3
1/2 7/8 .1/2 7/8 .1/2
..1/2 11/16
.1/2 11/16
October November
December
.1/2 7/8
.1/2 7/8
1/2 7/8
.1/2 7/8.
As will be seen after falling to a low point in July exchange rose slightly and remained very steady for the whole of the rest of the year. During this period there was a steady demand for Hong Kong dollars owing to events in China and the total note issues of the three note issuing banks and of the Government one dollar notes increased during the year as follows:-
31.12.37 31.12.36 Government $1 Notes $ 3,625,000 $ 2,300,000 Chartered Bank of I. A. & C. 25,172,604 22,756,888 H.K. & S. B. C. 199,689,793 124,863,771 Mercantile Bank of India, Ltd. 4,091,508 5,175,570 $154,012,167 $233,662,9678. A statement of the position of the Exchange Fund was made in October as follows:-
The Exchange Fund set up in December, 1935, took over, in accordance with Ordinance 54 of 1935, the silver which had to be delivered under that Ordinance; it also purchased during the first few months of its operation substantial quantities of exchange which were offered on the local market. It has since both bought and sold exchange as has been found necessary.
The silver taken over by the Fund was sold and the monies so obtained and exchange bought by the Fund constitute assets against the liabilities represented by Certificates of Indebtedness issued by the Treasurer to the Banks.
On June 30th last the Certificates of Indebtedness outstanding amounted to $152,652,579, which is equivalent to £9,342,020 at the rate of 1/2 11/16, the middle market rate on that day; the total assets of the Fund amounted to £10,316,240 of which 62.97% was invested in gilt edged sterling securities and 35.91% was held in cash or on deposit in London at call or short notice. The balance 1.12% represented silver.