By Kang Seung-woo
Staff reporter
Korea's foreign exchange reserves hit an all-time high in April on the back of a rise in capital gains from investment in stocks and bonds.
The Bank of Korea (BOK) said Tuesday that the nation's reserves reached $278.87 billion, up $6.54 billion from a month earlier. It was the second consecutive month of increases.
The figure surpassed the previous record high of $273.69 billion posted in January. It was the second-biggest monthly gain only behind a $6.7 billion jump in November last year.
Foreign reserves consist of securities and deposits denominated in overseas currencies along with International Monetary Fund (IMF) reserve positions, special drawing rights and gold bullion.
Among them, Korea suffered a $5.15 billion decrease in securities after the central bank sold bonds through a repurchase agreement (RP), but the loss was cancelled out by an $11.73 billion deposit.
"Gains from our investment in securities and interests incurring from bond holdings brought the foreign reserves to a record high," Moon Han-geun, an official at the BOK, was quoted as saying.
Meanwhile, currency dealers think that the government's dollar-buying intervention to curb the growing value of the won had an influence on the amount.
"Currency authorities are stepping in as the won is on course to the 1,100-won level due to strong foreign buying in the equity market. The upcoming listing of Samsung Life has attracted a huge amount of dollars," a dealer said.
The won closed at 1,112 won per dollar Tuesday.
As of the end of April, Korea was the world's sixth-largest holder of foreign exchange reserves after China, Japan, Russia, Taiwan and India.