South Africa's FX reserves drop to new multi-year lows in July

By bne IntelliNews August 7, 2015

South Africa’s foreign exchange reserves narrowed in July, reaching more than four-and-a-half year low levels, as the US dollar strengthened during the month, while gold prices fell, central bank data showed.

The gross gold and foreign exchange reserves shrank 2.1% m/m to $45.8bn, their lowest level since January 2011, following a 0.8% m/m growth in June. The South African Reserve Bank (SARB) attributed the decline to the appreciation of the dollar against major currencies, the fall in the dollar gold price and an increase in foreign exchange swaps conducted for liquidity management services.

South Africa’s international liquidity position (ILP), which represents its net forex reserves, fell 1.4% m/m to $41bn at end-July, the worst reading since September 2010, reversing a 0.2% m/m rise in June. The decrease was caused mainly by the drop in gross reserves, partly offset by a 2.2% fall in the received foreign currency deposits and an 11.1% increase in the forward position, which represents SARB’s unsettled spot or swap transactions.

The y/y drop in gross reserves deepened to 8.2% last month from 3.7% in June, and that in net reserves widened to 7.5% from 7.2%.

$mn Jul-15 Jun-15 m/m change
Gold reserves 4 370 4 718 -7.4%
SDR holdings 2 494 2 515 -0.8%
Foreign exchange reserves 38 959 39 597 -1.6%
Gross reserves 45 823 46 829 -2.1%
Foreign currency deposits received -7 368 -7 537 -2.2%
Forward position 2 553 2 298 11.1%
International liquidity position 41 007 41 590 -1.4%
Source: SARB      

Related Articles

Russia's Rosneft sets foot in Mediterranean with $1.125bn Eni deal

Russia's largest oil producer state-controlled Rosneft has acquired 30% in the largest natural gas field in the Mediterranean from Italian Eni, the company announced on October 9. Rosneft that ... more

PetroSA, Rosgeo sign $400mn oil and gas exploration agreement for South Africa

South Africa's national oil company PetroSA and Rosgeo, the geological exploration company of the Russian Federation, have signed an agreement on a $400mn oil and gas development project in South ... more

South Africa’s MTN to invest $350mn in Iranian broadband

South Africa’s MTN said it has agreed, on a non-binding and preliminary basis, to invest an initial $350mn into Iranian fixed broadband provider Iranian Net. The investment will give ... more

Dismiss