MOSCOW, Oct 2 (Bernama-Sputnik/RIA Novosti) — The volume of foreign exchange reserves held by global central banks exceeded US$12 trillion in the second quarter for the first time since the end of 2021, with the share of the dollar in these reserves hitting a historic low of 56.32 per cent, a RIA Novosti analysis of data from the International Monetary Fund showed.
Central banks’ foreign exchange reserves grew by 3.3 per cent in nominal terms in April-June this year, reaching US$12.025 trillion, which is only slightly less than the record level at the end of 2021, when it was US$12.05 trillion. Regulators disclosed the currency structure of 92.9 per cent of this amount.
In the second quarter, central banks’ investments in the dollar amounted to 56.32 per cent, compared to 57.79 per cent in January-March. However, the IMF explained that most of the decline was due to currency revaluation, which means that the dollar index against major reserve currencies fell by 10 per cent in the first half of the year, the largest decline since 1973. Excluding revaluation, the share would have decreased by 0.12 percentage points.
The main beneficiary of the reduction in regulators’ investments in the US dollar was the euro, whose share rose to its highest level since 2014, reaching 21.13 per cent. However, excluding currency fluctuations, central banks’ interest in this currency continued to decline, falling by 0.04 percentage points.
Overall, currency revaluation supported most reserve currencies in central bank assets amid declining demand from regulators, resulting in a less noticeable decline in their share. The Japanese yen lost only 0.03 percentage points (5.57 per cent), while the Canadian dollar and Swiss franc lost 0.02 percentage points each (2.62 per cent and 0.16 per cent, respectively).
At the same time, the currency effect for the pound sterling was able to offset the decline in demand, resulting in its share even increasing to 4.83 per cent from 4.74 per cent in the previous quarter.
The yuan’s share in central bank assets remained at 2.12 per cent, while the Australian dollar’s share in reserves rose to a three-quarter high of 2.09 per cent from 2.02 per cent in January-March.
The share of non-reserve currencies in financial regulators’ investments also grew significantly, from 4.92 per cent in January-March to 5.17 per cent at the end of the second quarter. This was a record level since the third quarter of 2012.
–BERNAMA-SPUTNIK/RIA NOVOSTI