Release at 8:15 a.m. EDT 
Ottawa, September 6, 2006
2006-044

Archived - Official International Reserves

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The Department of Finance announced today that Canada's official international reserves decreased by an amount equivalent to US$538 million during August to US$35,853 million.

Details on the level and composition of Canada's reserves as of August 31, 2006, as well as the major factors underlying the change in reserves, are provided below. All figures are in millions of US dollars unless otherwise noted.


Foreign Currency Reserves
Securities 29,989
Deposits   3,748
Total securities and deposits (liquid reserves) 33,737
Gold1 68
Special drawing rights (SDRs) 949
Reserve position in the IMF   1,099
Total: 

August 31, 2006     

35,853
July 31, 2006*  36,391
Net change -538

Details on Deposits
Other central banks/Bank for International Settlements 784
Banks headquartered in Canada 0
   Of which: located abroad 0
Banks headquartered abroad 2,964
   Of which: located in Canada 0          

Total

3,748

Details of Net Change
Reserves management operations2 -804
Gains and losses on gold sales 0
Net investment gains and losses
   Return on investments3 270
   Foreign currency debt charges -47
   Revaluation effects4 42
Net government operations5 0
Official intervention 0
Other transactions6     1
Net change -538

Currency Composition of Deposits and Securities
US dollars

17,010

Euro

16,213

Yen      514
Total 33,737

* The total official international reserves figure for July 2006 has been restated from US$36,395 million to US$36,391 million. See the footnote at the end of this document for further information (page 4). [Return]


Predetermined Short-Term Drains on Foreign Currency Reserves (Nominal Value)

0-1
month
1-3
months
3-12
months
Total
Foreign currency securities7 Principal -1,281 -1,103 -1,678 -4,062
Interest -62 -213 -1,115 -1,390
Aggregate short forward positions in foreign currencies vis-à-vis Canadian dollar 0 0 0 0
Aggregate long forward positions in foreign currencies vis-à-vis Canadian dollar          0          0          0          0
Total net drains -1,343 -1,316 -2,793 -5,452
Additional Information (Nominal Value)
Undrawn, unconditional credit lines with banks headquartered outside Canada 6,000
Securities lent under repurchase agreements8 -2,349
Securities held under repurchase agreements9 1,666
Financial derivatives assets (net, marked to market)
   Forwards 0
   Swaps 3,333

Notes:
1. There were no sales of gold settled in August. On August 31, gold holdings stood at 0.1 million ounces. The valuation is based on the August 31, 2006, London p.m. fix of US$623.50 per ounce.

2. Net change in securities and deposits resulting from foreign currency funding activities of the Government. (Issuance of foreign currency liabilities used to acquire assets increases reserves, while maturities decrease reserves). During August, a global bond of US$1,000 million matured. In addition, Canada bills increased by US$196 million to a level of outstanding bills of US$1,804 million.

3. "Return on investments" comprises US$107 million of interest earned on investments and a US$163-million increase in the market value of securities resulting from changes in interest rates.

4. "Revaluation effects" reflect changes in the market value of reserve assets resulting from movements in exchange rates.

5. "Net government operations" are the net purchases of foreign currency for government foreign exchange requirements and for additions to reserves.

6. Related to securities assumed by the Government of Canada, following the privatization of Petro-Canada in July 1991, and the subsequent dissolution of Petro-Canada Limited in 2001.

7. "Foreign currency securities" include maturities of foreign currency debt, cross-currency swap payments and an estimate of interest payments on foreign currency liabilities.

8. "Securities lent under repurchase agreements" are included in total reserves. Collateral provided in securities-lending transactions is not included in total reserves.

9. Cash invested under repurchase agreements is included in total reserves. Collateral provided in securities-lending transactions is not included in total reserves.

Future Release Dates

The next release is October 4, 2006 (covering the period September 2006).

A list of upcoming release dates is posted on the Department of Finance website located at www.fin.gc.ca/invest_x/releaseDates_e.asp.

___________________________________
For further information, media may contact:

Sandra Lavoratore
Financial Markets Division Department of Finance
613-947-3919

David Gamble
Media Relations Department of Finance
613-996-8080 

For further information on the Exchange Fund Account, please consult the 2004 Report on the Management of Canada's Official International Reserves, located at www.fin.gc.ca/toc/2005/oir05_-eng.asp.

If you would like to receive automatic e-mail notification of all news releases, please visit the Department of Finance website at

www.fin.gc.ca/scripts/register-eng.asp.

Official International Reserves

(10-Year Synopsis)


  US dollars Other currencies Gold SDRs IMF position Total

  (millions of US dollars)
August 31, 2006 17,010 16,727 68 949 1,099 35,853
July 31, 2006* 17,712 16,572 69 942 1,096 36,391
June 30, 2006* 17,671 16,143 67 939 1,092 35,912
May 31, 2006* 17,846 15,715 71 949 1,103 35,684
April 30, 2006 18,660 14,997 70 931 1,058 35,716
March 31, 2006 20,204 13,812 63 917 1,038 36,034
February 28, 2006 16,707 13,974 61 908 1,034 32,684
January 31, 2006 16,813 14,135 62 907 1,042 32,959
December 31, 2005 16,842 13,822 56 897 1,401 33,018
November 30, 2005 16,646 14,566 54 894 2,039 34,199
October 31, 2005 16,909 14,214 51 898 2,142 34,214
September 30, 2005 16,725 13,824 52 900 2,098 33,599
August 31, 2005 16,878 14,354 47 907 2,113 34,299

Dec. 31, 2004 14,426 15,740 48 925 3,327 34,466
Dec. 31, 2003 15,575 15,961 45 838 3,848 36,267
Dec. 31, 2002 17,946 14,739 205 712 3,567 37,169
Dec. 31, 2001 19,748 10,736 291 614 2,859 34,248
Dec. 31, 2000 21,692 7,327 323 574 2,508 32,424
Dec. 31, 1999 18,838 5,594 524 526 3,164 28,646
Dec. 31, 1998 15,907 4,004 122 1,097 2,297 23,427
Dec. 31, 1997 14,630 492 146 1,126 1,575 17,969
Dec. 31, 1996 17,521 507 155 1,168 1,227 20,578
Dec. 31, 1995 12,127 502 178 1,177 1,243 15,227

* The total official international reserves figures from May to July 2006 have been restated. The magnitude of the restatements is minor. The market valuation of US-dollar-denominated securities held as part of Canada's reserves has been adjusted. [Return]