South Korea’s forex reserves dip to nearly 5-year low in February

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EXPANED SWAP LINE The central bank cited its expanded swap line with the National Pension Service (NPS) late last year as a main reason for the fall.“The NPS has borrowed US dollars through the forex swap line, affecting the forex reserves,” said Kim Young-woong, an official from the Bank of Korea’s foreign exchange transactions’ accounting team.“They have to return them six months or a year later.” Last December, the Bank of Korea expanded its foreign exchange swap line to $65 billion from the previous $50 billion and extended it by one year until the end of 2025 as the Korean currency dropped to its lowest level in 15 years.

South Korea’s foreign exchange reserves diminished to the lowest level in nearly five years last month, largely due to the expanded forex swap line between the country’s central bank and national pension fund.

The forex reserves held by Asia’s fourth-largest economy came to $409.21 billion as of the end of February, down $1.8 billion from a month ago after extending the losing streak for two straight months.

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Category: Economy

Markets: South KoreaChinaJapan

Topics: Year Forex Bank Exchange Line Foreign Last Swap Reserves February Billion

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Published On: 2025-03-06 @ 15:54:26 (5 hours ago)

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