Korea’s foreign exchange reserves rose to a five-month high in January as the stronger euro and other non-dollar currencies increased the conversion value of those assets, the central bank said Thursday.

The country’s foreign reserves reached $311.34 billion last month, up $4.94 billion from the previous month, according to the Bank of Korea.

The January foreign reserves stood at the second highest level in history since the foreign reserves hit a record high $312.19 billion in August of 2011. It was also a rebound from the second consecutive month of decline.

“The conversion value of non-dollar assets increased with an ascent in the euro and the pound,” Shin Jae-hyuk, an economist at the BOK, told reporters. “Gold bullion maintained the same amount as the previous month.”

In January, the euro appreciated 1.1 percent to the U.S. dollar as the Fed’s low rate pledge and progress in tackling the eurozone crisis gave a boost to the currency. The British pound rose 1.4 percent against the greenback last month and the Japanese yen drifted up 0.9 percent.

South Korea held 36.3 percent of its foreign reserves in non-dollar assets as of the end of 2010, the latest available data.

Asia’s fourth-largest economy saw its foreign reserves surpass the $300 billion mark for the first time in April amid sustained inflows of foreign capital and robust exports.

The central bank said earlier this month that it won approval to invest in yuan-denominated stocks and bonds in mainland China and to participate in the inter-bank bond market there.

The BOK has not begun investing in the yuan-denominated securities in January, the official said.

Foreign reserves consist of securities and deposits denominated in overseas currencies, along with International Monetary Fund reserve positions, special drawing rights and gold bullion.

As of the end of December, Korea was the world’s seventh-largest holder of foreign exchange reserves. 

(Yonhap News)