Investment of Fund’s Assets

The Executive Board, observing that the Fund has had and may continue to have an excess of expenditure over income and that the greater part of the Fund’s administrative expenditures has been and will continue to be in United States dollars, considers that in the interest of good administration and conservation of the Fund’s resources it would be appropriate to raise income towards meeting the deficit by the investment of a portion of the Fund’s gold in a manner which will enable the Fund to reacquire gold at any time and will maintain the gold value of the investment.

In view of the foregoing and noting the willingness of the United States to consent to investment by the Fund in United States Treasury bills, the Executive Board takes the following decisions:

• I. The Executive Board, acting pursuant to Article XVIII (a) of the Articles of Agreement, interprets the Articles of Agreement to permit the investment described in the present decisions, namely, sale of a portion of the Fund’s gold to the United States for the purpose of investment of the proceeds in United States Treasury bills having not more than ninety-three days to run, subject to the following conditions:

  • (1) The amount of gold to be sold for investment:

    • (a) will not be such as to limit the ability of the Fund to make its resources available to members in accordance with the Articles of Agreement; and

    • (b) will be such as to produce an amount of income reasonably related to the deficit of the Fund;

  • (2) Whenever the Fund decides to reacquire gold after the sale or maturity of any United States Treasury bills invested in, it will be able to reacquire the same amount of gold as was sold for investment in such bills; and the United States, at the request of the Fund, will sell the said amount of gold to the Fund for U.S. dollars at the United States selling price at the time of the sale to the Fund;

  • (3) In any computations for the purpose of applying the provisions of the Articles of Agreement the Fund will treat the following assets as representing gold and not as holdings of United States currency:

    • (a) the dollar proceeds of the sale of gold before investment in United States Treasury bills; and

    • (b) the United States Treasury bills invested in; and

    • (c) the dollar proceeds resulting from the sale or maturity of any such bills before the purchase of gold therewith.

• II. (1) The Executive Board, acting pursuant to Article XVIII(a) of the Articles of Agreement, interprets Article IV, Section 8(a) to require the United States to maintain the gold value of the assets set forth in paragraph 1(3) (a), (b) and (c) above, notwithstanding changes in the par or foreign exchange value of the currency of the United States. This obligation of the United States shall be fully discharged by its maintaining the gold value of the dollar proceeds resulting from the sale of the gold or from the sale or maturity of the U.S. Treasury bills purchased therewith.

• (2) For the purposes of paragraphs I and II of these decisions the dollar proceeds resulting from the sale or maturity of the U.S. Treasury bills invested in shall not include the income of the investment.

• III. Subject to the receipt of an assurance from the United States in accordance with paragraph I(2) above satisfactory to the Fund, the Executive Board decides that an amount of the Fund’s gold sufficient to realize approximately but not more than two hundred million United States dollars shall be sold to the United States and the proceeds invested and reinvested in United States Treasury bills having not more than ninety-three days to run. The Executive Board will review the amount and operation of the investment at quarterly intervals and at such other times as may be appropriate.

Decision No. 488-(56/5)

January 25, 1956

Fund’s Investment Program

The Executive Board, observing that the Fund has had and in the future may again have an excess of expenditure over income and that the greater part of the Fund’s administrative expenditure has been and will continue to be in United States dollars, considers that in the interest of good administration and conservation of the Fund’s resources it would be appropriate to raise income and provide a reserve towards meeting possible future deficits by continuing the investment of a portion of the Fund’s gold in a manner which will enable the Fund to reacquire gold at any time and will maintain the gold value of the investment.

In view of the foregoing and noting the willingness of the United States to consent to continued investment by the Fund in United States Treasury bills, the Executive Board takes the following decisions:

• A. Paragraphs I, II and III of Executive Board Decision No. 488-(56/5) shall remain in effect except that the following shall be substituted for paragraph I(1) (b): “will be such as to produce an amount of income reasonably related to the purpose of the investment.”

• B. The income of the investment earned after October 31, 1957 shall be placed to a Special Reserve, and any administrative deficit for any fiscal year of the Fund shall be written off first against this reserve.

Decision No. 708-(57/57)

November 27, 1957

Fund’s Investment Program

The Executive Directors (1) decide that for the purposes of Executive Board Decisions No. 488-(56/5) and No. 708-(57/57) on the investment of the proceeds of the sale of gold, the amount of $500,000,000 shall be substituted for $200,000,000 in Paragraph III of Executive Board Decision No. 488-(56/5), and (2) pursuant to Article XVIII- (a), interpret the Articles of Agreement to permit such investment in U.S. securities having a term to maturity not exceeding twelve months.

Decision No. 905-(59/32)

July 24, 1959

Fund’s Investment Program

The amount of $200 million in paragraph III of Executive Board Decision No. 488-(56/5), which was subsequently increased to $500 million by Executive Board Decision No. 905-(59/32), shall be increased to $800 million for all of the purposes of those decisions and Executive Board Decision No. 708-57/57).

Decision No. 1107-(60/50)

November 30, 1960

Fund’s Investment Program

The authorization under (2) of Executive Board Decision No. 905-(59/32) is extended to permit an investment of the amount of $61,900,000 in 15-month U.S. Treasury securities maturing February 15, 1963.

Decision No. 1272-(61/53)

November 3, 1961