South Korea’s foreign exchange reserves totaled US$401.48 billion as of the end of last month, showing a month-on-month decrease of US$1.63 billion, the Bank of Korea said on Sept. 3.
The decrease in foreign exchange reserves is mainly attributable to a strong U.S. dollar. Last month, the U.S. dollar Index, which shows the value of the U.S. dollar in comparison to six major currencies, rose from 98.05 to 98.51 while the euro and the Australian dollar respectively depreciated by 0.9 percent and 2.1 percent and the yen and the British pound respectively appreciated by 1.9 percent and 0.2 percent. As a result, the value of South Korea’s non-U.S. dollar-denominated foreign currency assets converted to the U.S. dollar decreased to lead to the decrease in foreign exchange reserves.
Marketable securities such as government and government agency bonds and asset-backed securities accounted for 92.4 percent of the total foreign exchange reserves, decreasing by US$1.03 billion from a month ago. Deposits in foreign central banks and major global banks accounted for 4.9 percent of the total, followed by gold reserves (1.2 percent), the IMF SDR (0.8 percent), and the IMF position (0.7 percent).
As of the end of July this year, South Korea ranked ninth in the world in terms of the size of foreign exchange reserves with a total of US$403.1 billion. China (US$3.1037 trillion) topped the list, followed by Japan (US$1.3165 trillion) and Switzerland (US$828.8 billion).