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Foreign reserves fall for 2nd month

Korea’s foreign exchange reserves shrank for the second straight month in June because a weaker British pound reduced the dollar conversion value, the central bank said Monday.

The country’s foreign reserves reached $304.48 billion as of the end of June, down $600 million from the previous month, according to the Bank of Korea.

The reserves fell for the second straight month in June after hitting a record high of $307.2 billion in April, the central bank said.

Foreign reserves consist of securities and deposits denominated in overseas currencies, along with International Monetary Fund reserve positions, special drawing rights and gold bullion.

In June, the pound fell 2.4 percent to the greenback mainly because the British economy remains sluggish and Bank of England Gov. Mervyn King stressed the need to support low rates, citing risks from Greece’s debt crisis.

Other non-dollar assets appreciated to the dollar. The euro added 0.8 percent to the dollar and the Japanese yen rose 1.3 percent to the greenback.

As of the end of May, Korea was the world’s seventh-largest holder of foreign exchange reserves after China, Japan, Russia, Taiwan, Brazil and India. 

(Yonhap News)