FX reserves top $400 billion for first time ever in June

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FX reserves top $400 billion for first time ever in June

Korea’s foreign exchange reserves surpassed the $400 billion mark for the first time in June on a steady increase in gains from investment in overseas assets, the central bank said Wednesday.

The total value of the country’s foreign exchange reserves came to a record $400.3 billion last month, up $1.32 billion from a month earlier, according to the Bank of Korea (BOK).

Korean foreign exchange reserves reached $300 billion in April 2011, $200 billion in February 2005 and $100 billion in September 2001.

Foreign exchange reserves consist of securities and deposits denominated in overseas currencies, as well as International Monetary Fund (IMF) reserve positions, special drawing rights and gold bullion.

“Out of the total, 91.9 percent is securities, which guarantee us steady proceeds,” said a BOK official, adding that the monthly figure has broken records every month since March, when it hit $395.75 billion.

“The sheer size of the foreign reserve means that we have strong economic fundamentals,” he said.

The country’s reserve position at the IMF stood at $1.91 billion at the end of June, while holdings in gold bullion were worth $4.79 billion during the same period, the central bank said.

As of the end of May, South Korea placed ninth in the world rankings of foreign exchange reserves. China topped the list, followed by Japan and Switzerland.

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