TNAG-0448-FCO40-513-Sterling-assets-and-balance-of-payments-of-Hong-Kong-1974 — Page 176

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5196

Telex received in clear from ~

ACCOUNTANT GENERAL TREASURY

Despatched:-

Received: 09.11

GOVERNMENT OF HONG KONG

HONG KONG

Tuesday, 19th March 1974 Tuesday, 19th March 1974

OUR REF EF.26/6 PT.2

10.

THANK YOU FOR YOUR 13.

I HAVE BEEN UNABLE

FOR PAYTON FROM BLYE.

THERE SEEMS TO BE SOME MISUNDERSTANDING.

TO CONTACT THE FINANCIAL SECRETARY TO DISCUSS THE POINT RAISED IN YOUR MESSAGE BUT IN VIEW OF ITS IMPORTANCE I AM TAKING IT

UPON MYSELF TO REPLY IMMEDIATELY.

IN PARAGRAPH 4 OF OUR 1317 DATED 17TH NOVEMBER TO FCO WE EXPLAINED THAT UNTIL THE MONTH END VALUATIONS OF OUR GILT EDGED HOLDINGS HAD BEEN MADE WE WOULD NOT KNOW WHETHER THE TOTAL VALUE OF OUR MONTH END STERLING HOLDINGS IS EQUAL TO OUR AGREED

MSP.

SINCE THAT DATE THE GILT EDGED MARKET HAS AS YOU KNOW

WHEN THE MONTH END VALUATION HAS BEEN WEAKENED CONSIDERABLY.

MADE WE HAVE OBTAINED THE STERLING NECESSARY TO BRING OUR HOLDINGS OF THAT CURRENCY UP TO THE AGREED MINIMUM BEFORE THE DATE THE ADVICES ARE NEXT DUE AFTER THE ADVICE DATE ON WHICH

THE FAILURE OCCURRED.

WE HAVE SO FAR BOUGHT ABOUT L10.6 MILLION FOR THIS PURPOSE AND

OUR PRELIMINARY FIGURE FOR FEBRUARY COMPLETED TODAY INDICATE THAT ANOTHER L4 MILLION WILL HAVE TO BE PURCHASED BEFORE THE END

OF THIS MONTH MAKING A TOTAL OF L14.5 MILLION. AS I SEE IT THIS

IS STRICTLY IN ACCORDANCE WITH THE AGREED ARRANGEMENT AND I DO

NIT UNDERSTAND WHY YOU SAY THE ARRANGEMENTS GO BEYOND THE TERMS

AGREED FOR DEALING WITH ACCIDENTAL BREACHES WHICH ARE SET OUT IN

FCO TELEGRAM 1209 DATED 26TH NOVEMBER.

I SHOULD PERHAPS ADD

THAT THERE HAVE BEEN NO SWITCHES OUT OF STERLING INTO OTHER

CURRENCIES AND THAT IN TOTAL THE VALUE OF OUR HOLDINGS OF GILTS

PS FALLEN BY L29 MILLION SINCE 25TH SEPTEMBER

10

FOR STAMP SEE REVER

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