South Korea’s foreign currency reserves added $40 million last month on gains in global bond investments, offsetting decreased returns in non-dollar assets from the strengthening in the U.S. dollar.

According to data released by the Bank of Korea on Monday, the country’s foreign currency reserves stood at $403.11 billion at the end of July, up $40 million from a month ago.

The rise in external reserve is owed to increased revenue from the bank’s investment in foreign assets, the BOK said. Profits from investing in low-risk, investment-grade bonds issued by developed countries jumped thanks to a rally in bond prices after the U.S. and many countries shifted to monetary easing.

The stronger U.S. dollar, however, pushed down the dollar value of non-dollar denominated foreign assets such as euro and yen held in Korea.

The U.S. dollar index, which measures the value of the U.S. dollar relative to world’s six major currencies, gained 1.9 percent in July, meaning the dollar turned stronger versus others in the currency basket.

The value of foreign securities, including stocks, government bonds and corporate debts, came at $372.02 billion after losing $1.82 billion on month, while cash deposits in foreign bank accounts grew $1.75 billion to $20.24 billion.

The special drawing rights, international reserve asset created by the International Monetary Fund (IMF), decreased $70 million to $3.39 billion.

The country’s reserve position with the IMF stood at $2.67 billion after adding $180 million on month, while gold reserves were unchanged at $4.79 billion.

Korea remained the world’s ninth largest holder of foreign exchange reserves as of the end of June. China topped the list with $3.12 trillion, followed by Japan with $1.32 trillion.

By Lee Yu-sup and Lee Ha-yeon

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