Foreign reserves fall in August on strong dollar

Piles of dollars [YONHAP]

Korea's foreign reserves fell in August as the strong dollar reduced the conversion value of euro and other currency-denominated assets, central bank data showed Monday.

The country's foreign reserves came to $436.4 billion as of end-August, down $2.2 billion from the previous month, according to the data provided by the Bank of Korea (BOK).

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

August's fall came after a rebound in July following four months of decline from March to June.

The dollar gained ground as the U.S. Federal Reserve remained steadfast in raising the benchmark rate to fight high-flying inflation.

Global energy crunch from the Russian invasion of Ukraine, along with natural disaster in China, also has pushed up the value of the U.S. greenback.

Foreign securities, such as Treasurys, were valued at $394.9 billion as of end-August, up $3.1 billion from the previous month. It accounted for 90.5 percent of total foreign reserves.

The value of deposits decreased by $5.3 billion on-month in August to $17.9 billion, which made up 4.1 percent of the reserves.

Korea was the world's ninth-largest holder of foreign reserves as of the end of July, the BOK said.

Yonhap