SEOUL, Aug. 5 (Xinhua) -- South Korea's foreign exchange reserves grew for a second straight month due to higher converted value of non-U.S. dollar assets and investment returns, central bank data showed Wednesday.
The foreign exchange reserves rose 0.59 billion U.S. dollars from a month earlier to 427.95 billion dollars at the end of July, after gaining 0.37 billion dollars in the previous month, according to the Bank of Korea (BOK).
The consecutive growth was attributed to investment returns, an increase in the U.S. dollar-converted value of non-dollar assets and the issuance of foreign exchange stabilization bonds that offset the effect of the foreign exchange market stabilization measures.
The BOK allowed the National Pension Service (NPS) through the FX swap contract to borrow the dollar funds from the central bank's foreign reserves instead of buying them in the spot market.
The FX swap deal helped mitigate upward pressure on the South Korean won versus U.S. dollar exchange rate by absorbing massive dollar demand from the NPS's overseas investment.
The dollar index, which gauges the U.S. dollar value versus six major peers, declined 1.2 percent last month.
The country's foreign reserves were composed of 380.01 billion dollars of securities, 23.13 billion dollars of deposits, 15.70 billion dollars of special drawing rights, 4.79 billion dollars of gold bullion and 4.32 billion dollars of the IMF position.
The Asian country ranked as the world's 10th-largest holder of foreign reserves at the end of June, up three notches from a month earlier. ■
