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Korea's foreign reserves dwindled further in August. The Bank of Korea on Tuesday said that as of the end of August, Korea's foreign currency holdings stood at US$243.2 billion, down $4.32 billion from July, when they had already dropped by the largest-ever monthly margin of $10.58 billion.
That reduced foreign reserves by $15 billion over the last two months. Foreign reserves stood at $262.22 billion at the end of 2007 but started depleting since April this year.
But a BOK official said while in July foreign reserves dwindled significantly as the country sold a lot of forex holdings to defend the exchange rate, ¡°in August it was a mere numerical decline in dollar-denominated reserves due to exchange rate fluctuations in the value of foreign currencies" such as euro.
As of the end of 2007, dollar-denominated reserves accounted for 64.6 percent of the total, with the rest being in euro, pound and yen. Oil prices fell in August as the U.S. dollar strengthened, but other currencies weakened in relation, reducing the total value of dollar-denominated foreign reserves. As of the end of June, Korea ranked sixth in terms of foreign exchange reserves after China ($1,808.8 billion), Japan ($1,004.7 billion), Russia ($595.9 billion), India ($306.2 billion), and Taiwan ($290.9 billion).
(englishnews@chosun.com )
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