Small Exchange: South Korea’s biggest monthly fall, Zimbabwe pushes for formal forex trading and Moroccan reserves slip
This week's currency news rounded up.
Foreign currency deposits sink in South Korea
The latest Bank of Korea data reveals that foreign currency deposits fell by US$6.33 billion month-on-month in June, the greatest monthly reduction recorded.
Deposits of foreign cash dropped to US$63.61 billion as of the end of last month, as a result of large sales of US dollars by South Korean companies, according to Xinhua.
The won/dollar exchange rate hovered at 1,144.1 won per dollar at the close of June, significantly higher than the rate in May. Foreign deposits were highest in March this year, peaking at US$70.54 billion.
Zimbabwe pushes for formal forex trading
In an effort to formalise foreign exchange trading and destabilise the black market, Zimbabwe's reserve bank has begun to ease the rules surrounding bureaux de change.
The Financial Gazette reports that local analysts believe that this move may spur Zimbabweans to use more formal, legal channels when exchanging foreign currency.
While the move is a positive step, these measures have done little in the short-term to quell the exchange of illicit moneys. Zimbabwe's black market regularly trades in illegal cash. Late last year there were reports that a number of illicit trading groups were using global messenger service WhatsApp to strike daily forex deals.
Morocco's foreign reserves tumble year-on-year
Bank Al Maghrib, Morocco's central bank, has revealed that net international reserves fell by 14.6% year-on-year as of 30 June 2017.
Reserves totalled MAD205.9 billion in June this year. This means that reserves declined 0.8% week-to-week during 2016/2017, according to the central bank's latest weekly indicators.
Morocco World News reported that Bank Al Maghrib injected MAD63.1 billion in the form of 7-day advances, upon invitation to tender. MAD4.5 billion was also added as support for financing small to medium-sized enterprises.
Each week Small Exchange sums up currency news from around the globe and looks into how it impacts exchange rates and options.