PRESS RELEASE

Sales of foreign exchange interest income by the European Central Bank (ECB)

14 September 2000

At the beginning of 1999 the ECB was provided with foreign reserve assets with a market value, at that time, of some EUR 39.5 billion, 15% of which was gold. These assets were transferred to the ECB by the national central banks of the Eurosystem in accordance with Article 30 of the Statute of the ESCB.

The foreign currency component of the ECB's foreign reserve assets has been invested, and it earns foreign exchange revenue for the ECB. The ECB's holdings of foreign currencies have increased by an amount corresponding to over EUR 2.5 billion since the beginning of 1999, mainly on account of receipts of interest income, denominated primarily in US dollars but also in Japanese yen. The Governing Council of the ECB decided at its meeting on 31 August 2000 that inflows derived from the interest income of the foreign reserve assets would be sold against euro in order to maintain the structure and risk profile of the ECB's balance sheet as it was at the beginning of 1999.

The sale of the interest income accrued so far will start today and will be spread over a number of days. After this initial sale, it is intended that future inflows will normally be sold on a regular basis. The amounts actually sold will be indicated in the ECB's commentary on the consolidated financial statement of the Eurosystem, published on a weekly basis.

The Federal Reserve Bank of New York and the Bank of Japan have been informed of these planned foreign exchange operations.

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