Central banks experiencing the biggest drop in foreign exchange reserves

8/8/2015 0:00

Capitals - Agencies
announced the US bank Citigroup said the central bank sold about $ 260 billion of foreign exchange reserves in the second quarter of the year with trying those banks in emerging markets to mitigate the repercussions of the funds from their economies escape.

This is a decline biggest drop in global foreign exchange reserves With more than ten years, surpassing attrition in 2008-2009 when the central banks actively tried to control the fallout from the global financial crisis.

The International Monetary Fund published in the June 30 official reserves of the first quarter of the year only data, and will publish official data for the second quarter in a matter of weeks.

But Most major central banks in the world have already published their reserves numbers at the end of June where Citigroup estimated it fell by $ 85 billion to 11.35 trillion dollars, but it reduces the real size of the decline.

Global president said the strategy of foreign exchange with the City of New York Steven Englander that when calculating exchange rates and remittances effects between currencies, central banks have sold the fact that up to $ 260 billion of reserves.

"The central banks sold reserves to protect their currencies from collapse". She said Aberdeen, which manages assets of about $ 480 billion, reflecting concerns about the emerging markets, it is estimated Net outflows of about 9.9 billion pounds to 15.46 billion dollars during the quarter ended June 30.

Are published figures on foreign exchange reserves in dollars around the world. About 64 percent of which are denominated in the US currency and the rest is denominated in other currencies and mostly in euros.

This means that when the dollar falls, the nominal value of non-dollar reserves with central banks go up automatically. But in the second quarter basic precautions and the dollar fell together.

fell basic precautions $ 85 billion with the US currency falling three percent. Accordingly, the increased value of the portion denominated in other currencies of precautions, which a little more than four trillion dollars by about $ 120 billion.

Englander said that to compensate for this change in the value of the central banks sold more than $ 200 billion.