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Foreign reserves grow for 1st time in 5 months in July

Aug. 3, 2022 - 09:07 By Yonhap
A clerk checks US dollars at the headquarters of Hana Bank in Seoul on July 5. South Korea's foreign exchange reserves dropped $9.43 billion on-month to $438.28 billion as of end-June, marking the biggest monthly decline since 2008, according to the Bank of Korea. (Yonhap)

South Korea's foreign reserves increased for the first time in five months in July, thanks to increased operation profits and expanded deposits in foreign currency, central bank data showed Wednesday.

The country's foreign reserves came to $438.61 billion as of end-July, up $330 million 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.

July's increase came after foreign reserves shrank in the previous four months.

It also came in contrast with the previous month when the reserves dropped by the largest amount in more than 13 years as foreign exchange authorities unloaded dollars to help stem the local currency's decline.

The BOK attributed the July growth to increased profits from operation of the reserves and expanded foreign currency deposits by financial companies.

Securities were valued at $391.85 billion as of end-July, down $3.42 billion from the previous month. It accounted for 89.3 percent of the total foreign reserves.

The value of deposits, however, grew $3.98 billion on-month in July to $23.2 billion, which made up 5.3 percent of the reserves.

South Korea was the world's ninth-largest holder of foreign reserves as of the end of June, the BOK said. (Yonhap)