South Korea’s foreign exchange reserves climbed for a fifth consecutive month in October, reaching $428 billion, the Bank of Korea said Tuesday.
The $6 billion increase from September was driven by higher investment income and new issuances of foreign exchange stabilization bonds.
While the numbers drew limited attention abroad, the steady rebound underscores how South Korea has been rebuilding its dollar holdings in a global environment still defined by high U.S. interest rates and a strong greenback.
The reserves had fallen to $404 billion in May, the lowest in nearly five years, before recovering as markets stabilized.
Most of South Korea’s assets are held in securities such as government and corporate bonds, which totaled $377 billion, down slightly from a month earlier.
Deposits rose by $7 billion to $26 billion, offsetting smaller declines in other categories, including the country’s holdings in the International Monetary Fund’s Special Drawing Rights, which fell to $157 billion. Gold holdings were unchanged at $4 billion, recorded at purchase value rather than market price.
South Korea remains the world’s ninth-largest holder of foreign reserves, following China ($3.3 trillion), Japan ($1.3 trillion), and Switzerland ($1 trillion). The steady increase offers a glimpse into how major Asian economies continue adjusting to prolonged dollar strength and tight global liquidity conditions shaped by U.S. monetary policy.
