§ Mr. Gouldasked the Chancellor of the Exchequer how much the Bank of England has spent in sustaining the rate for the £ sterling (a) over the past six months and (b) over the past two years.
§ Mr. Robert SheldonThe change in the reserves (net of official borowing) over the two periods has been as follows:
End-October 1975—End-October 1977 +$4.7 billion.
End-April 1977—End-October 1977 +$7.6 billion.
These figures are derived from the gross reserve changes by deducting borrowing by Her Majesty's Government, drawings from the IMF, borrowing by the public sector under the exchange cover scheme, borrowing by the British National Oil Corporation and accruals from the sale of BP shares in North America.
The reserves change is the result of a variety of transactions. The figures given above do not solely reflect market intervention since there are also varying transactions for Government and other central banks.
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§ Mr. Gouldasked the Chancellor of the Exchequer by how much the £ sterling has appreciated against the German mark since October 1976; and what effect this is expected to have on the deficit in trade in manufactures with West Germany.
§ Mr. Robert SheldonThe average sterling/deutschemark rate in October 1976, when sterling was under heavy pressure, was 4.0023 while the closing rate on 22nd November 1977 was 4.0557, an appreciation of 1.33 per cent. It is not thought that this will significantly affect the improvement that has been taking place this year in the trade deficit in manufactures with West Germany.