[Asia Economy Reporter Kim Eun-byeol] South Korea's foreign exchange reserves in November set a new all-time record once again.
The Bank of Korea announced on the 3rd that as of the end of November, South Korea's foreign exchange reserves amounted to $436.38 billion, an increase of $9.87 billion compared to the end of October ($426.51 billion).
South Korea's foreign exchange reserves sharply declined in March due to the impact of the novel coronavirus disease (COVID-19), but have since rebounded and continued to increase. Since June, the reserves have continuously broken all-time records.
A Bank of Korea official explained, "The increase in foreign exchange reserves was influenced by higher returns on foreign currency asset management and the rise in the US dollar equivalent of foreign currency assets denominated in other currencies." While the US dollar showed weakness, the low interest rate environment continued, leading to increased returns on foreign currency assets, and as the dollar weakened, other currencies relatively strengthened.
By composition, securities amounted to $394.64 billion, an increase of $10.98 billion compared to the previous month, while deposits decreased by $1.19 billion to $29.32 billion. Gold remained at $4.79 billion, and IMF positions ($4.4 billion) and SDRs ($3.22 billion) slightly increased.
Meanwhile, as of the end of October, South Korea's foreign exchange reserves ranked 9th globally. China holds the top position with foreign exchange reserves of $3.128 trillion. Japan ranks second with $1.3844 trillion, followed by Switzerland in third place with $1.0217 trillion.
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