South Korea’s foreign exchange reserves topped $405 billion last month on higher interest returns on assets parked in overseas central banks and institutions.
According to data released by Bank of Korea on Wednesday, Korea’s foreign exchange reserves reached $405.25 billion as of the end of March, up $580 million from the previous month when the country saw the first on-month contraction in four months.
The gain in external reserve largely owed to increased revenue from the bank’s foreign exchange operations despite the stronger U.S. dollar that led to a decrease in the value of other currencies when converted into the dollar. During the last month, the euro fell 1.3 percent against the U.S. dollar, the British pound 2.0 percent, and the Australian dollar 1.0 percent. The Japanese yen edged up 0.3 percent.
By asset type, securities including government, public entity and corporate bonds dropped by $1.61 billion to $377.5 billion, while cash deposits in foreign bank accounts rose by $2.06 billion to $17.27 billion.
The special drawing rights (SDR) from the International Monetary Fund (IMF) decreased $20 million to $3.36 billion. SDR is an international reserve asset created by the IMF that can be withdrawn by its members in proportion to their quota in the IMF.
The country’s reserve position with the IMF stood at $2.32 billion after adding $150 million on month, while gold reserve were unchanged at $4.79 billion.
Korea remained the world’s eighth biggest holder of foreign exchange reserves as of the end of last month. China topped the list with $3.09 trillion, followed by Japan with $1.28 trillion won.
By Lee Yu-sup and Lee Ha-yeon
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