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MAS: S$5.2b investment gain in FY15/16 official foreign reserves

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The Monetary Authority of Singapore (MAS) said on Monday it recorded a S$5.2 billion investment gain in the official foreign reserves (OFR) in FY2015/16, lower than prior years due to higher valuation provisions on certain equity investments.

THE Monetary Authority of Singapore (MAS) said on Monday it recorded a S$5.2 billion investment gain in the official foreign reserves (OFR) in FY2015/16, lower than prior years due to higher valuation provisions on certain equity investments.

In the previous financial year, MAS recorded an investment gain of S$10.4 billion. As at March 31, 2016, the OFR stood at S$332 billion.

"The increase in provisions was due mainly to the market values of some equity securities in MAS's portfolio falling below cost, as global equity markets declined in FY2015/16," the central bank said in its annual report.

The investment gain is derived after stripping out currency translation effects. About three-quarters of the OFR are denominated in the G4 currencies (US dollar, euro, yen and sterling), with the greenback forming the bulk among the G4 currencies.

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But currency movements have no impact on the international purchasing power of the OFR; they do not affect MAS's ability to conduct exchange rate policy or provide a buffer in the event of a sharp deterioration in Singapore's balance of payments, the central bank said.

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