§ Colonel J. R. H. Hutchison
asked the Chancellor of the Exchequer what has been the net reduction in our gold and dollar reserves during each of the months of February and March; and how much of this reduction has been for the United Kingdom alone.
§ Sir S. Cripps
During the first quarter of 1948 we had to find £147 million from our gold and dollar reserves to meet the current deficit in the balance of payments of the sterling area, including the United Kingdom.
On 1st January, 1948, the central holdings of gold and dollars amounted to £512 million. During the first quarter our reserves were reinforced by the South African gold loan of £80 million and we also drew the rest of the U.S. line of credit (£74 million). We drew £11 million from the Canadian line of credit and £15 million from the I.M.F. India also drew £7 million from the I.M.F.
The combined effect of all the above transactions is that the central holdings of gold and dollars increased to £552 million at 31st March, 1948. But sums received during the quarter in reinforcement of our reserves were to a large extent non-recurrent.
These figures are directly comparable with those given in Table III of Cmd. 7324. As explained in that paper, the drain on the reserves of the Sterling Area 36W cannot be completely apportioned between the United Kingdom and the other countries of the sterling area.
Happenings in one month are apt to give a distorted picture, and this is particularly likely to be the case during the next few months while the European Recovery Programme is coming into operation. I therefore propose to discontinue, the monthly figures of gross gold sales and in future to publish quarterly statements at a convenient date after the end of the quarter.