South Africa's net gold and foreign exchange reserves fell 4.5 percent to $32.111 billion in October, as the rand weakened and the price of gold dropped, official data showed on Friday. The Reserve Bank said the net liquidity position dipped from $33.638 billion in September, while gross reserves decreased to $32.908 billion from $34.424 billion.
The central bank has been steadily building up its reserves over the past four years but a sharp fall in the value of the rand last month removed the opportunity to buy dollars and a big drop in the price of gold cut the value of its stocks. Analysts said the fall was likely mostly related to currency revaluations given the drop in the value of the bank's euro reserves as the European currency softened against the dollar.
Gold reserves slid by $616 million to $2.943 billion as the price of the precious metal tumbled to $734.45 an ounce at the end of last month. The central bank brought a long-standing negative position in reserves into balance early in 2004 with the elimination of its loss-making forward foreign exchange book, historically the Achilles heel of the currency.
While net reserves -- known as the net liquidity position -- have risen significantly over the past four years, they still lag holdings in other emerging economies.
The central bank has been steadily building up its reserves over the past four years but a sharp fall in the value of the rand last month removed the opportunity to buy dollars and a big drop in the price of gold cut the value of its stocks. Analysts said the fall was likely mostly related to currency revaluations given the drop in the value of the bank's euro reserves as the European currency softened against the dollar.
Gold reserves slid by $616 million to $2.943 billion as the price of the precious metal tumbled to $734.45 an ounce at the end of last month. The central bank brought a long-standing negative position in reserves into balance early in 2004 with the elimination of its loss-making forward foreign exchange book, historically the Achilles heel of the currency.
While net reserves -- known as the net liquidity position -- have risen significantly over the past four years, they still lag holdings in other emerging economies.
No comments:
Post a Comment