0
U.S. dollars. / Yonhap-AP

South Korea's foreign exchange reserves increased by $2.6 billion last month, returning to growth after a month of decline. The increase was driven by investment returns on foreign currency assets and a rise in foreign currency deposits held by financial institutions.

According to the Bank of Korea's report on foreign exchange reserves at the end of October, released on Nov. 4, South Korea's foreign exchange reserves stood at $443.16 billion (approximately 596.27 trillion won) at the end of last month, up $2.6 billion from $440.56 billion at the end of the previous month. The reserves rebounded after declining by $1.72 billion in September.

The BOK cited investment returns on foreign currency assets and increased foreign currency deposits by financial institutions as major factors behind the rise in reserves.

By asset type, deposits increased sharply by $6.32 billion from the previous month to $36.27 billion, accounting for 8.2% of total foreign exchange reserves.

Meanwhile, securities, including government bonds, government agency bonds and corporate bonds, declined by $3.59 billion from the previous month to $382.43 billion. However, they remained the largest component of foreign exchange reserves, accounting for 86.3% of the total.

Special drawing rights (SDRs) decreased by $70 million from the previous month to $15.41 billion, while the International Monetary Fund (IMF) reserve position fell by $50 million to $4.25 billion. Gold holdings remained unchanged at $4.79 billion.

In October, the U.S. Dollar Index, which measures the dollar's value against a basket of six major currencies, rose 0.7% from 101.37 to 102.04.

During the same period, the euro depreciated by 1.3% against the dollar, while the Japanese yen weakened by 0.2%. In contrast, the British pound appreciated by 1.2% and the Australian dollar gained 0.5%, reflecting mixed movements among major currencies.

                                                                                                          Han Sang-wook