Foreign Exchange Reserves in March Reach $419.3 Billion, Increase After 3 Months

An employee is organizing dollars at the Hana Bank Counterfeit Response Center in Jung-gu, Seoul. Photo by Jinhyung Kang aymsdream@

Foreign exchange reserves returned to an upward trend after three months, supported by an increase in foreign currency deposits at financial institutions.

According to the Bank of Korea on the 3rd, as of the end of March, South Korea's foreign exchange reserves stood at $419.25 billion, an increase of $3.51 billion compared to the previous month.

Due to the strength of the US dollar, South Korea's foreign exchange reserves had decreased for two consecutive months until February. The dollar index continued its strength in March, rising 0.5% compared to the previous month. However, in March, foreign currency deposits at financial institutions and earnings from foreign currency asset management increased, leading to a rise in foreign exchange reserves.

A Bank of Korea official stated, "Although the dollar strength in March caused the dollar-converted value of other currency foreign assets to decrease, the overall reserves increased due to the rise in foreign currency deposits at financial institutions and earnings from foreign currency asset management."

By asset type, securities such as government bonds and corporate bonds accounted for the largest portion at $364.89 billion (87.0%). In addition, deposits amounted to $30.53 billion (7.3%), Special Drawing Rights (SDR) at the International Monetary Fund (IMF) were $14.7 billion (3.5%), gold was $4.79 billion (1.1%), and the IMF position was $4.33 billion (1.0%).

As of the end of February, South Korea maintained its 9th place in the world in terms of the size of foreign exchange reserves (as of last month). China ranked first with $3.2258 trillion. Japan was second with $1.2815 trillion, Switzerland third with $854.4 billion, and India fourth with $625.2 billion.