DREYFUS GLOBAL BOND FUND, INC.
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to report that during a period marked by good overseas
bond markets, but weak underlying currencies, the Dreyfus Global Bond Fund,
Inc. was able to deliver a positive U.S. dollar return for the second half of
the year, as well as the entire year. The total return for the fiscal
half-year ended November 30, 1997 was 6.06%, outperforming the Salomon
Brothers World Government Bond Index (unhedged) by 3.06%. In a strong U.S.
dollar environment, we slightly underperformed the same index, fully hedged,
by -0.65%. For the full 12 months ended November 30, the Fund provided a
total return of 5.42%,* which was 5.70% more than the total return from the
Salomon Brothers World Government Bond Index (unhedged) and -3.65% less than
the same Index fully hedged.**
ECONOMIC REVIEW
After a difficult start of the year, global bond markets settled down as
earlier negative economic sentiments were eased by improving political and
economic conditions within the developed markets. Bond market participants
not only saw but began to believe in the benign economic and financial news
that appeared. Overall, 1997 turned out to be a favorable environment for
global bonds in the markets in which the Fund concentrates. Global inflation
was moderate and in most countries, inflation actually declined.
All markets, except Japan, benefited from the adoption of fiscal
constraints intended to help maintain the low inflation environment. Looking
forward, the forces of deflation should help the global economy remain
intact. This provides a positive global background which should ease some of
the concerns surrounding the approaching European Monetary Union. The current
and projected economic environment continues to make a strong case for global
bonds as part of an investor's total portfolio.
MARKET ENVIRONMENT
Global bond markets got off to a less than exciting start this year due
to concerns over accelerating U.S. economic growth, coupled with fears of
rising inflation. During the second half of the year, bond markets not only
settled down, but staged a rally. Led by strong rallies in the dollar bond
markets of Canada and Australia along with the U.K. and the peripheral
European markets of Italy, Spain and Sweden, most markets returned anywhere
from 5% to 9.5% over this period in local currency terms.
At the same time, there were strong rallies in underlying currency
markets. The U.S. dollar was one of the best performing currencies and
greatly appreciated versus the yen and most European currencies. This dollar
strength, if left unchecked, would have essentially reduced, by the amount of
its appreciation, the value of our non-U.S. bond returns. With a goal of
counteracting this effect and delivering positive gains to our investors in
U.S. dollar terms, we aggressively hedged the portfolio back to the U.S.
dollar over this period. Subsequently, anywhere from 60% to 97% of the
portfolio was hedged back to the U.S. dollar, thus ensuring that the foreign
bond gains were not entirely eroded. We believe that 1997 demonstrated the
value of global bonds in a total portfolio when balanced against the high
volatility experienced in international equity markets.
PORTFOLIO FOCUS
Over the second half of the year, the portfolio's average duration was
decreased and is currently in line with the benchmark duration. Although we
maintained our generally positive outlook for interest rates, the fall in
adjusted real yields during the third quarter caused us to reduce our
holdings in the 3- to 10-year maturity range as we perceived a decrease in
value within this portion of the yield curve. Our allocation to securities
with maturities of between five to 15 years remained constant as we perceived
value in this area of the curve. The proceeds from the reduced position in 3-
to 10-year securities were invested in cash securities. This maturity
structure and decreasing market duration detracted
slightly from the Fund's performance. Currently, we have responded to the
model's call for an increase in the overall duration of the portfolio.
The number of overall markets held in the portfolio during the second
half of the year remained in the area of five to six. While there were good
opportunities in most bond markets, we began, at the start of the third
quarter, to focus the holdings in those markets that were relatively the most
attractive as indicated by our value model. The portfolio held substantial
positions over the last quarter of the fiscal year in the U.S., Spanish and
Australian markets, which were among the best performing markets in U.S.
dollar terms over this period. This decision was the largest contributor to
the Fund's positive performance during the second half of the year.
The Fund continued its aggressive hedging policy in an effort to ensure
that we captured and delivered to shareholders, in U.S. dollars, gains
realized in foreign bond markets. This hedging activity served the Fund very
well during the second half of the year as the U.S. dollar appreciated
against most other currencies. At the end of November, over 80% of the Fund
was hedged back to the U.S. dollar with the intention of protecting the
portfolio from adverse currency fluctuations.
Because of our generally positive view of interest rates worldwide at the
beginning of the year, we maintained a longer-than-market maturity and
duration profile. This longer-than-market duration detracted from
performance, as many markets saw interest rates end the last six months at
the same levels or higher than where they began the period. However, we did
begin to reduce duration gradually to a level nearer to that of the market,
in expectation of an increase in worldwide economic activity. Maturities
within each market remain in the 5- to 15-year area, as these sectors of most
yield curves look most attractive.
With the Fund solidly performing between the hedged and unhedged global
bond indices, we believe it is well positioned for the immediate future. We
will, of course, continue to adjust the Fund's portfolio as economic and
market conditions change.
Sincerely,
(Christine Downton SIGNATURE LOGO)
Christine Downton
Portfolio Manager
December 18, 1997
New York, N.Y.
* Total return includes reinvestment of dividends and any capital gains
paid.
** SOURCE: LIPPER ANALYTICAL SERVICES, INC .-Unlike the Fund, which can
invest in both corporate and government bonds, the Salomon Brothers World
Government Bond Index is a market-capitalization weighted index consisting of
debt issues of 14 government bond markets.
DREYFUS GLOBAL BOND FUND, INC. NOVEMBER 30, 1997
(Exhibit A)
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN DREYFUS GLOBAL BOND
FUND, INC.
AND THE SALOMON BROTHERS WORLD GOVERNMENT BOND INDEX
Dollars
$13,748
Dreyfus Global
Bond Fund
$12,691
Salomon Brothers
World Government
Bond Index* (unhedged)
*Source: Lipper Analytical Services, Inc.(Exhibit A)
Average Annual Total Returns
<TABLE>
One Year Ended From Inception (3/18/94)
November 30, 1997 to November 30, 1997
____________________ __________________________
<S> <C> <C>
5.42% 8.96%
</TABLE>
Past performance is not predictive of future performance.
The above graph compares a $10,000 investment made in Dreyfus Global Bond
Fund, Inc. on 3/18/94 (Inception Date) to a $10,000 investment made in the
Salomon Brothers World Government Bond Index (unhedged) on that date. For
comparative purposes, the value of the Index on 3/31/94 is used as the
beginning value on 3/18/94. All dividends and capital gain distributions are
reinvested.
The Fund's performance shown in the line graph takes into account all
applicable fees and expenses. The Salomon Brothers World Government Bond
Index is a fixed-income index and is a market-capitalization weighted
benchmark that tracks the performance and covers debt issues of 14 government
bond markets. The Index measures the total rate-of-return performance for
government bond markets with a remaining maturity of at least one year and
does not take into account charges, fees and other expenses. Further
information relating to Fund performance, including expense reimbursements,
if applicable, is contained in the Financial Highlights section of the
Prospectus and elsewhere in this report.
<TABLE>
DREYFUS GLOBAL BOND FUND, INC.
STATEMENT OF INVESTMENTS NOVEMBER 30, 1997
Principal
Bonds and Notes-73.8% Amount Value
_______________________________________________________________________________ ___________ __________
<S> <C> <C>
Banking-4.0% International Bank of Reconstruction,
Notes:
63/8%, 2005......... $ 360,000 $ 366,330
8%, 2007........ 106,090(a) 111,660
___________
477,990
___________
Foreign/Governmental-30.0% Australia Government,
Bonds, 71/2%, 2009................... 431,263(b) 482,669
Finnish Export Credit,
Notes, 6.85%, 2007................... 291,321(c) 312,624
Government of New Zealand,
Bonds, 7%, 2009...................... 444,096(a) 454,687
New South Wales Treasury Corp.,
Notes, 61/2%, 2006................... 463,284(b) 470,234
Queensland Treasury,
Global Notes, 61/2%, 2005............ 476,910(b) 486,038
South Australian Finance,
Notes, 71/2%, 2007................... 408,780(b) 441,458
SpainGovernment,
Deb., 8.20%, 2009.................... 401,822(c) 478,067
Treasury Corp. of Victoria,
Bonds, 71/8%, 2005................... 473,504(b) 492,739
___________
3,618,516
___________
Supranational-2.7% European Investment Bank,
Notes, 53/4%, 2008................... 316,769(c) 319,461
___________
U.S. Government
Agency-3.9% Federal National Mortgage Association,
Global Notes, 63/8%, 2007............ 471,460(b) 469,692
___________
U.S. Government-33.2% U.S. Treasury Bonds,
71/4%, 5/15/2016..................... 1,667,000 1,875,636
U.S. Treasury Notes:
71/4%, 8/15/2004..................... 1,721,000 1,849,536
63/8%, 3/31/2001..................... 270,000 274,346
___________
3,999,518
___________
TOTAL BONDS AND NOTES
(cost $8,821,670).................... $ 8,885,177
===========
</TABLE>
<TABLE>
DREYFUS GLOBAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) NOVEMBER 30, 1997
Principal
Short-Term Investments-23.7% Amount Value
_______________________________________________________________________________ ___________ __________
<S> <C> <C>
U.S. Treasury Bills: 4.72%, 12/4/1997..................... $ 101,000 $ 100,933
4.94%, 12/11/1997.................... 112,000 111,812
4.77%, 12/26/1997...................... 41,000 40,849
4.91%, 1/2/1998........................ 91,000 90,576
4.92%, 1/8/1998........................ 703,000 699,035
4.91%, 1/15/1998....................... 398,000 395,401
5.18%, 1/22/1998....................... 1,433,000 1,421,909
___________
TOTAL SHORT-TERM INVESTMENTS
(cost $2,861,457).................... $ 2,860,515
===========
TOTAL INVESTMENTS (cost $11,683,127)........................................ 97.5% $11,745,692
==== ===========
CASH AND RECEIVABLES (NET).................................................. 2.5% $ 300,530
=== ===========
NET ASSETS.................................................................. 100.0% $12,046,222
===== ===========
Notes to Statement of Investments:
______________________________________________________________________________
(a)Converted to U.S. Dollars from New Zealand Dollars.
(b)Converted to U.S. Dollars from Australian Dollars.
(c)Converted to U.S. Dollars from Spanish Pesetas.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS GLOBAL BOND FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES NOVEMBER 30, 1997
Cost Value
___________ __________
<S> <C> <C>
ASSETS: Investments in securities-See Statement of Investments $11,683,127 $11,745,692
Cash....................................... 60,508
Interest receivable........................ 190,644
Net unrealized appreciation on forward
currency exchange contracts-Note 4(a)....... 135,510
Receivable for forward currency exchange contracts 40,291
Prepaid expenses and other assets.......... 22,736
___________
12,195,381
___________
LIABILITIES: Due to The Dreyfus Corporation and affiliates.... 113
Due to Distributor......................... 2,458
Payable for shares of Common Stock redeemed.... 21,254
Payable for forward currency exchange contracts.... 92,020
Accrued expenses........................... 33,314
___________
149,159
___________
NET ASSETS.................................................................. $12,046,222
===========
REPRESENTED BY: Paid-in capital............................ $11,479,329
Accumulated undistributed investment income-net....... (99,270)
Accumulated net realized gain (loss) on investments
and foreign currency transactions................... 272,543
Accumulated net unrealized appreciation (depreciation)
on investments and foreign currency transactions.... 195,080
___________
NET ASSETS.................................................................. $12,046,222
===========
SHARES OUTSTANDING
(300 million shares of $.001 par value Common Stock authorized)............. 928,909
NET ASSET VALUE, offering and redemption price per share.................... $12.97
======
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS GLOBAL BOND FUND, INC.
STATEMENT OF OPERATIONS YEAR ENDED NOVEMBER 30, 1997
INVESTMENT INCOME
<S> <C> <C>
INCOME Interest Income (net of $160 foreign taxes
withheld at source).............. $ 721,269
EXPENSES: Management fee-Note 3(a)............. $ 78,283
Shareholder servicing costs-Note 3(b)....... 31,526
Registration fees.................... 30,071
Directors' fees and expenses-Note 3(c)....... 26,078
Auditing fees........................ 24,000
Legal fees........................... 16,778
Organization expenses................ 13,003
Custodian fees....................... 8,721
Loan commitment fees-Note 2.......... 107
Miscellaneous........................ 6,043
___________
Total Expenses................. 234,610
Less-expense reimbursement from Manager due to
undertaking-Note 3(a)............ (83,326)
___________
Net Expenses................... 151,284
___________
INVESTMENT INCOME-NET................................................. 569,985
___________
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS-Note 4:
Net realized gain (loss) on investments and
foreign currency transactions.... $ 302,544
Net realized gain (loss) on forward currency
exchange contracts............... 196,630
___________
Net Realized Gain (Loss)....... 499,174
Net unrealized appreciation (depreciation) on
investments and foreign currency transactions (461,429)
___________
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS................ 37,745
___________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.................. $ 607,730
===========
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS GLOBAL BOND FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
November 30, 1997 November 30, 1996
__________________ _________________
<S> <C> <C>
OPERATIONS:
Investment income-net............................................... $ 569,985 $ 853,759
Net realized gain (loss) on investments............................. 499,174 812,517
Net unrealized appreciation (depreciation) on investments........... (461,429) (391,286)
___________ ___________
Net Increase (Decrease) in Net Assets Resulting from Operations... 607,730 1,274,990
___________ ___________
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net............................................... (755,805) (1,458,377)
___________ ___________
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold....................................... 2,809,403 1,086,523
Dividends reinvested................................................ 677,809 1,257,808
Cost of shares redeemed............................................. (2,071,927) (7,861,858)
___________ ___________
Increase (Decrease) in Net Assets from Capital Stock Transactions. 1,415,285 (5,517,527)
___________ ___________
Total Increase (Decrease) in Net Assets......................... 1,267,210 (5,700,914)
NET ASSETS:
Beginning of Period................................................. 10,779,012 16,479,926
___________ ___________
End of Period....................................................... $12,046,222 $10,779,012
=========== ===========
Undistributed investment income-net................................... $ 99,270 $ 68,157
___________ ___________
Shares Shares
____________ ____________
CAPITAL SHARE TRANSACTIONS:
Shares sold......................................................... 220,169 86,181
Shares issued for dividends reinvested.............................. 53,428 100,387
Shares redeemed..................................................... (162,545) (630,010)
____________ ____________
Net Increase (Decrease) in Shares Outstanding..................... 111,052 (443,442)
============ ============
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS GLOBAL BOND FUND, INC.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This
information has been derived from the Fund's financial statements.
Year Ended November 30,
_____________________________________________
PER SHARE DATA: 1997 1996 1995 1994(1)
______ ______ ______ _______
<S> <C> <C> <C> <C>
Net asset value, beginning of period................... $13.18 $13.07 $12.04 $12.50
______ ______ ______ ______
Investment Operations:
Investment income-net.................................. .65(2) .77(2) .85 .65
Net realized and unrealized gain (loss) on investments. .02(2) .55(2) 1.06 (.54)
______ ______ ______ ______
Total from Investment Operations....................... .67(2) 1.32(2) 1.91 .11
______ ______ ______ ______
Distributions:
Dividends from investment income-net................... (.88) (1.21) (.88) (.57)
______ ______ ______ ______
Net asset value, end of period......................... $12.97 $13.18 $13.07 $12.04
====== ====== ====== ======
TOTAL INVESTMENT RETURN.................................... 5.42% 10.96% 16.47% 1.29%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets................ 1.35% 1.34% .81% -
Ratio of net investment income to average net assets... 5.10% 5.87% 6.76% 7.83%(3)
Decrease reflected in above expense ratios
due to undertakings by the Manager................... .75% .66% 1.12% 2.49%(3)
Portfolio Turnover Rate................................ 274.83% 81.34% 20.46% 4.16%(4)
Net Assets, end of period (000's Omitted).............. $12,046 $10,779 $16,480 $15,275
(1) From March 18, 1994 (commencement of operations) to November 30, 1994.
(2) Based on average shares outstanding.
(3) Annualized.
(4) Not annualized.
See notes to financial statements.
</TABLE>
DREYFUS GLOBAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
Dreyfus Global Bond Fund, Inc. (the "Fund") is registered under the
Investment Company Act of 1940 ("Act") as a non-diversified open-end
management investment company. The Fund's investment objective is to seek
total return. The Dreyfus Corporation ("Manager") serves as the Fund's
investment adviser. Dreyfus is a direct subsidiary of Mellon Bank, N.A.,
which is a wholly-owned subsidiary of Mellon Bank Corporation. Premier Mutual
Fund Services, Inc. (the "Distributor") is the distributor of the Fund's share
s, which are sold to the public without a sales charge.
As of November 30, 1997, MBIC Investment Corp., an indirect subsidiary of
Mellon Bank Corporation, held 540,596 shares of the Fund.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management
estimates and assumptions. Actual results could differ from those estimates.
(A) PORTFOLIO VALUATION: Investments in securities are valued each
business day at the last sales price on the securities exchange on which such
securities are primarily traded or at the last sales price on the national
securities market. Securities not listed on an exchange or the national
securities market, or securities for which there were no transactions, are
valued at the average of the most recent bid and asked prices. Bid price is
used when no asked price is available. Investments denominated in foreign
currencies are translated to U.S. dollars at the prevailing rates of
exchange. Forward currency exchange contracts are valued at the forward
rate.
(B) FOREIGN CURRENCY TRANSACTIONS: The Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates
on investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, sales of foreign currencies, currency
gains or losses realized on securities transactions and the difference
between the amount of interest and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received
or paid. Net unrealized foreign exchange gains and losses arise from changes
in the value of assets and liabilities other than investments in securities,
resulting from changes in exchange rates. Such gains and losses are included
with net realized and unrealized gain or loss on investments.
(C) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Interest
income, including, where applicable, amortization of discount on investments,
is recognized on the accrual basis.
(D) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net are declared and paid monthly.
Dividends from net realized capital gain are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to
comply with the distribution requirements of the Internal Revenue Code. This
may result in distributions that are in excess of investment income-net and
net realized gain on a fiscal year basis. To the extent that net realized
capital gain can be offset by capital loss carryovers, if any, it is the
policy of the Fund not to distribute such gain.
On November 28, 1997, the Board of Directors declared a cash dividend of
$.048 per share from undistributed investment income-net, payable on December
1, 1997 (ex-dividend date), to shareholders of record as of the close of
business on November 28, 1997.
(E) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, if such qualification is in the
best interests of its shareholders, by complying with the applicable
provisions of the Internal
DREYFUS GLOBAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Revenue Code, and to make distributions of taxable income sufficient to
relieve it from substantially all Federal income and excise taxes.
As of November 30, 1997, the Fund reclassified certain components of net
assets. The reclassifications resulted in a net increase to accumulated
undistributed investment income-net and a decrease in accumulated net
realized gains on investments and foreign currency transactions of $216,933.
This reclassification was the result of permanent book to tax differences,
primarily from foreign currency transactions. Net assets were not affected by
these reclassifications.
NOTE 2-BANK LINE OF CREDIT:
The Fund participates with other Dreyfus-managed funds in a $600 million
redemption credit facility ("Facility") to be utilized for temporary or
emergency purposes, including the financing of redemptions. In connection
therewith, the Fund has agreed to pay commitment fees on its pro rata portion
of the Facility. Interest is charged to the Fund at rates based on prevailing
market rates in effect at the time of borrowings. During the period ended
November 30, 1997, the Fund did not borrow under the Facility.
NOTE 3-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement with the Manager, the management
fee is computed at the annual rate of .70 of 1% of the value of the Fund's
average daily net assets and is payable monthly. The Manager had undertaken
from December 1, 1996 through November 30, 1997 to reduce the management fee
paid by, or reimburse such excess expenses of the Fund, to the extent that
the Fund's aggregate annual expenses (exclusive of taxes, brokerage, interest
on borrowings, commitment fees and extraordinary expenses) exceed an annual
rate of 1.35% of the value of the Fund's average daily net assets. The
expense reimbursement, pursuant to the undertaking, amounted to $83,326
during the period ended November 30, 1997.
(B) Under the Shareholder Services Plan, the Fund pays the Distributor at
an annual rate of .25 of 1% of the value of the Fund's average daily net
assets for the provision of certain services. The services provided may
include personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the Fund and providing reports and other
information, and services related to the maintenance of shareholder accounts.
The Distributor may make payments to Service Agents (a securities dealer,
financial institution or other industry professional) in respect of these
services. The Distributor determines the amounts to be paid to Service
Agents. During the period ended November 30, 1997, the Fund was charged
$27,958 pursuant to the Shareholder Services Plan.
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
the Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund. During the
period ended November 30, 1997, the Fund was charged $4,325 pursuant to the
transfer agency agreement.
(C) Each director who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $1,000 and an attendance fee of $250
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 4-SECURITIES TRANSACTIONS:
(A) The aggregate amount of purchases and sales of investment securities,
excluding short-term securities and forward currency exchange contracts,
during the period ended November 30, 1997 amounted to $25,488,567 and
$25,940,346, respectively.
<TABLE>
DREYFUS GLOBAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
In addition, the following summarizes open forward currency exchange
contracts at November 30, 1997:
Foreign Unrealized
Currency Appreciation
Forward Currency Exchange Contracts Amount Proceeds Value (Depreciation)
____________________________________ ------------- ___________ __________ _______________
<S> <C> <C> <C> <C>
Sales:
- ------
Australian Dollar, expiring 12/17/97......... 4,280,000 $3,111,997 $2,916,820 $195,177
French Franc, expiring 12/17/97.............. 1,320,000 225,197 223,536 1,661
Spanish Peseta, expiring 12/17/97............ 167,000,000 1,095,841 1,118,853 (23,012)
Purchases: Cost
__________ ___________
British Pound, expiring 12/17/97............. 276,000 $ 464,325 465,502 1,177
Japanese Yen, expiring 12/17/97.............. 61,300,000 507,407 481,388 (26,019)
New Zealand Dollar, expiring 12/17/97........ 23,000 14,796 14,180 (616)
Swedish Krona, expiring 12/17/97............. 2,660,000 357,105 344,247 (12,858)
________
TOTAL.................................... $135,510
========
</TABLE>
The Fund enters into forward currency exchange contracts in order to hedge
its exposure to changes in foreign currency exchange rates on its foreign
portfolio holdings. When executing forward currency exchange contracts, the
Fund is obligated to buy or sell a foreign currency at a specified rate on a
certain date in the future. With respect to sales of forward currency
exchange contracts, the Fund would incur a loss if the value of the contract
increases between the date the forward contract is opened and the date the
forward contract is closed. The Fund realizes a gain if the value of the
contract decreases between those dates. With respect to purchases of forward
currency exchange contracts, the Fund would incur a loss if the value of the
contract decreases between the date the forward contract is opened and the
date the forward contract is closed. The Fund realizes a gain if the value of
the contract increases between those dates. The Fund is also exposed to credit
risk associated with counter party nonperformance on these forward currency
exchange contracts which is typically limited to the unrealized gain on each
open contract.
(B) At November 30, 1997, accumulated net unrealized appreciation on
investments and forward currency exchange contracts was $198,075, consisting
of $414,320 gross unrealized appreciation and $216,245 gross unrealized
depreciation.
At November 30, 1997, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS GLOBAL BOND FUND, INC.
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF DIRECTORS
DREYFUS GLOBAL BOND FUND, INC.
We have audited the accompanying statement of assets and liabilities of
Dreyfus Global Bond Fund, Inc., including the statement of investments, as of
November 30, 1997, and the related statement of operations for the year then
ended, the statement of changes in net assets for each of the two years in
the period then ended, and financial highlights for each of the years
indicated therein. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements and financial highlights. Our procedures included
confirmation of securities owned as of November 30, 1997 by correspondence
with the custodian and brokers. An audit also includes assessing the
accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Dreyfus Global Bond Fund, Inc. at November 30, 1997, the results
of its operations for the year then ended, the changes in its net assets for
each of the two years in the period then ended, and the financial highlights
for each of the indicated years, in conformity with generally accepted
accounting principles.
[ERNST & YOUNG LLP signature logo]
New York, New York
January 13, 1998
Registration Mark
[Dreyfus lion "d" logo]
DREYFUS GLOBAL BOND FUND, INC.
200 Park Avenue
New York, NY 10166
INVESTMENT ADVISER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 098AR9711
Global Bond
Fund, Inc.
Annual Report
November 30, 1997
Registration Mark
[Dreyfus logo]
