Foreign exchange reserves, also known as forex reserves, are assets held by a country’s central bank in foreign currencies, primarily US dollars and euros. These reserves can also include gold, government bonds, and other securities. They are used to facilitate international trade, maintain currency stability, and strengthen investor confidence. Central banks manage forex reserves as a safeguard against external shocks and to ensure economic resilience.
Holding reserves in foreign currency provides a financial cushion in times of crisis. If a country’s national currency loses value or faces volatility, these reserves can be used to support the economy. The size of a nation’s forex reserves often reflects a combination of economic strength, strategic planning, and financial resilience, underscoring its influence in the global economy.
This gallery highlights the countries with the largest foreign exchange reserves and explores the key reasons behind their accumulation. Intrigued? Click on to find out more!
All amounts are in USD.