FX reserves rebound on weak dollar

The nation’s foreign reserves rebounded in June from the previous month as investment profits gained and a weaker dollar raised the conversion value of non-dollar assets, the central bank said yesterday.

The country’s foreign reserves reached $312.38 billion as of the end of June, up $1.51 billion from the previous month, according to the Bank of Korea.

The foreign reserves in May retreated after they hit a fresh record high of $316.84 billion in April. The country’s FX reserves have been widely on the rise on the back of continued exports and inflows of foreign capital.

Foreign reserves consist of securities and deposits denominated in overseas currencies, along with International Monetary Fund reserve positions, special drawing rights and gold bullion.

The central bank said a gain in the reserves in June mainly came due to growing investment profits and a weaker U.S. dollar.

In June, the euro appreciated 0.6 percent on-month to the dollar and the British pound rose 0.2 percent against the greenback.

As of end-May, Korea was the world’s seventh-largest holder of foreign exchange reserves.

The Bank of Korea is making efforts to diversify its portfolio of foreign reserves. Yonhap