Korea has been holding the highest amount of foreign exchange for four consecutive months.
On October 5, the Bank of Korea announced the amount of its foreign exchange holdings at the end of October is US$343.23 billion, which is US$6.3 million higher than the previous month. This is breaking the record of US$336.92 billion from September yet again.
Foreign exchange holdings have been decreasing from April’s US$328.8 billion to US$328.1 billion in May, and US$326.44 billion in June, but started increasing since July. In fact, the increase in October is the largest yet since October 2011 (US$7.59 billion).
Head of the Bank of Korea’s International Management Team Ko Won-hong said, “This is due to the operating profits from assets in foreign currency and the euro strengthening from the US’s decision on quantitative easing, increasing the dollar conversion amount of foreign currency assets.” With the dollar weakening due to the expected delay in the US decision to reduce quantitative easing, and the relatively strengthening euro, the conversion rate for US dollars increased. Looking at the foreign exchange holding, marketable securities took 90.5%, decreasing US$510 million to US$310.75 billion from the previous month (US$311.26 billion). Deposits marked 6.3%, increasing US$6.81 billion to US$21.66 billion. Gold recorded 1.4% at US$4.79 billion.