South Korea’s foreign exchange reserves shrank in May from a record high reached in the previous month as a weaker euro and a softer British pound reduced the conversion value of non-dollar assets, the central bank said Monday.
The country’s foreign reserves reached $310.87 billion at the end of last month, down $5.97 billion from April, according to the Bank of Korea (BOK). In April, the country’s foreign reserves reached an all-time-high of $316.84 billion.
Asia’s fourth-largest economy first saw its foreign reserves surpass the $300 billion mark in April 2011 amid sustained inflows of foreign capital and robust exports.
“The single biggest reason for the drop was the lower value of non-dollar assets when converted into US dollars,” the BOK said in a statement. “The fall took place despite a rise in foreign reserve asset investment profits.”
Foreign reserves consist of securities and deposits denominated in overseas currencies, along with the International Monetary Fund reserve positions, special drawing rights and gold bullion.
As of end-April, South Korea had the seventh-largest foreign reserves in the world, according to the BOK. China, Japan and Russia ranked in the top three, with Taiwan, Brazil and Switzerland coming in ahead of South Korea.