South Korea’s foreign exchange reserves rise for the first time in three months last month, supported by a new $3 billion issuance of foreign exchange stabilisation fund bonds.

The Bank of Korea said on Wednesday the country’s foreign exchange reserves stood at $427.62 billion at end-February, up $1.72 billion from $425.91 billion at end-January.

Reserves fall in December ($2.6 billion) and January ($2.15 billion) for two straight months.

A Bank of Korea official said reserves rise due to the new issuance of foreign-currency foreign exchange stabilisation fund bonds and investment returns, despite market-stabilisation measures including foreign exchange swaps with the National Pension Service and a drop in the dollar-converted value of foreign-currency assets in other currencies.

The increase, however, fell well short of the bond issuance size due to exchange market volatility management and the impact of a strong dollar.

The government issued dollar-denominated foreign exchange stabilisation fund bonds last month, including $1 billion in 3-year notes and $2 billion in 5-year notes. It was the biggest single issuance since $3 billion in 2009.

By asset, securities such as government bonds and corporate bonds, at $379.96 billion, and the International Monetary Fund (IMF) position, at $4.61 billion, rise by $2.44 billion and $220 million, respectively.

Deposits, at $22.49 billion, and IMF special drawing rights, at $15.77 billion, fall by $830 million and $110 million, respectively.

Gold is priced at its purchase cost rather than market value, so it held at $4.79 billion, unchanged from a month earlier.

South Korea’s foreign exchange reserves rank 10th in the world as of end-January ($425.91 billion). They hold ninth from September to December last year, but slipped one notch after being overtaken by Hong Kong.

China has the most at $3.3991 trillion, followed by Japan ($1.3948 trillion), Switzerland ($1.1095 trillion), Russia ($833.6 billion), India ($711.5 billion), Germany ($652.3 billion), Taiwan ($604.5 billion), Saudi Arabia ($475.8 billion) and Hong Kong ($435.6 billion).

[Yonhap News Agency]