893.5151/3–1348: Telegram

The Secretary of State to the Ambassador in China (Stuart)

447. Central Bank China balances at New York Federal [Reserve Bank] now quite low (Embtel 464 Mar 13) but Central Bank has other balances and may borrow from other Government banks as in repayment US$13 million to Exim Bank Feb. 7 for which dollars made available [by] Bank of China. Confidential data provided by Pei Tsuyee5 showed net dollar assets of Chinese Govt banks at US$176 million on Dec 31 compared with reported official short term balances of US$137.8 million same date. Both figures exclude surplus property account at U. S. Treasury and gold in Shanghai but include Central Bank gold in U. S. Difference believed mainly dollar securities owned by Bank of China plus Central Bank vault cash.

[Page 366]

Since preliminary figures for Jan 31 indicate decline of about US$18 million, believe net dollar assets Govt bank sufficient for near term needs. Will ask Pei later information.

  1. Chairman of the Chinese Technical Mission in Washington.