Total global foreign exchange reserves up $ 810 b in five years

Tuesday, 4 August 2020 00:00 - - {{hitsCtrl.values.hits}}

China holds nearly one-third of global currency reserves

Foreign exchange reserves are essential to a nation’s economic well-being. Monetary authorities use these external assets for many purposes, but mostly to ensure a central government agency has backup funds if the national currency rapidly devalues.

According to data gathered by ForexSchoolOnline.com, total foreign exchange reserves increased by $ 810 billion in the last five years, reaching an $ 11.73 trillion value in the first quarter of 2020. The dollar accounts for 62% of Foreign Exchange Reserves.

Foreign exchange reserves can include deposits, banknotes, bonds, treasury bills, and other government securities. In 2005, the total value of these external assets worldwide reached $ 4.32 trillion, revealed Statista and International Monetary Fund data. In the next five years, this figure rose by $ 4.94 trillion, reaching a total of $ 9.26 trillion at the end of 2010. Statistics show that by the end of 2013, global foreign exchange reserves jumped to $ 11.68 trillion. However, this figure fell to $ 10.71 trillion in the next three years. The IMF data indicate the total value of these assets rose by $ 1.02 trillion since 2016.

Analysed by currency, the dollar accounted for nearly 62% of global foreign exchange reserves, with almost $ 6.8 trillion worth assets as of the first quarter of 2020. Euro ranked as the second-most used reserve currency, with $ 2.19 trillion worth assets, or more than 20% of global forex reserves.

Japanese Yen follows with and $ 624 billion in currency reserves, and 5.70% market share, respectively. China has by far the largest forex reserves, with nearly $ 3.4 trillion worth assets as of May 2020, or almost 30% of the world`s currency reserves. The International Monetary Fund data revealed that Japan is ranked as the second country on this list with $ 1.64 trillion in reserve assets, twice less compared to leading China. Statistics show that Japanese forex reserves increased by $ 242 billion in the last four months. As the third country on this list, Switzerland had $ 913.5 billion in foreign exchange reserves as of May, nearly a $ 58 billion increase in four months.

Russia and India follow, with $ 566.1 billion and $ 495.7 billion worth assets, respectively. The United States forex reserves, which are mostly euros and yen, were valued at $ 133.2 billion in July.