Israel's foreign currency reserves continued to grow in March 2010. The main cause of the increase was not Bank of Israel dollar purchases, but a €1 billion government bond issue by the Ministry of Finance, the Bank of Israel reported today.
Israel's foreign currency reserves rose by $1.74 billion in March to a record $62.47 billion, 2.8% more than in February.
The Bank of Israel bought $500 million in March. Government transfers from overseas totaled $1.42 billion, mostly from the eurobond issue. Purchases by the private sector added another $16 million.
A downward valuation cut the foreign currency reserves by $199 million in March, mostly due to the euro's weakness against the dollar. The Bank of Israel holds 65% of its foreign currency reserves in dollars, 24% in euros, and the rest in pounds and yen. Depreciation of the euro therefore reduces the total value of Israel's foreign currency reserves. The euro fell 0.7% against the dollar in March, due to the Greek debt crisis.
Published by Globes [online], Israel business news - www.globes-online.com - on April 7, 2010
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