The document discusses foreign exchange (FX) reserves, defining them as external assets controlled by monetary authorities for financing balance of payments and regulating currency exchange rates. It presents trends in FX reserves for various countries, ranking China, Japan, and Russia among the top holders, and highlights their significance in foreign debt repayment and credit rating assessments. Additionally, it outlines sources and uses of these reserves, underscoring their role in stabilizing currencies and countering market volatility.

1. Foreign Exchange (FX) reserves
Rajiv Poplai

2. • Definition and trends
• Constituents
• Global Comparison
• Sources and Spending
• Conclusion
Agenda

3. “ External assets that are
readily available to,
and controlled by,
monetary authorities
for direct financing of
external payments
imbalances, for
indirectly regulating the magnitudes of
such imbalances through intervention in
exchange markets to affect the currency
exchange rate, and/or for other purposes”
Definition

4. Indian Trends

5. • Foreign Currency Assets (FCA)
• Special Drawing Rights (SDR)
• GOLD
• Reserve Tranche Position (RTP)
Constituents

6. Rank Country Billion USD (end of month)
1 People's Republic of China [note 1]
$ 2648.3 (Sep 2010)[2]
2 Japan $ 1019 (Jun 2009)[3]
— Eurozone $ 753 (Sep 2010)
3 Russia[note 2]
$ 476 (Oct 2010)[4]
4 Republic of China (Taiwan) $ 383.38 (Sept 2010) [5]
5 Saudi Arabia $ 410 (Dec 2009)[6]
6 India [note 2]
$ 297.96 (Oct 29, 2010)[7]
7 South Korea $ 293.35 (October 2010)[8]
8 Brazil[note 3]
$ 287 (Oct 2010)[9]
— Hong Kong $ 266.1(Sep 2010)
9 Switzerland[note 4]
$ 250 (Aug 2010)
10 Singapore $ 214.7 (Sep 2010)
11 Germany $ 184 (Sep 2009)
12 Thailand $ 159.1 (Sep 2010)[10]
13 Italy $ 144 (June 2010)
14 France $ 143 (June 2010)
15 United States $ 129 (July 2010)
Global Comparison

7. Sources
• Foreign Investment
• External Commercial
Borrowings (ECB)
• Short Term Credit
• Banking Capital

8. • To stabilize Issued Currency
• To counter volatility
• Prepayment/Repayment of External Debt
• Investment
Spending

9. • Foreign exchange reserves are important
indicators of ability to repay foreign debt
and for currency defense, and are used to
determine credit ratings of nations
Conclusion

10. Thank You !