RIO DE JANEIRO, BRAZIL – Peru’s net international reserves amounted to US$72.468 billion as of October 30, the Central Reserve Bank (BCR) has reported. This level of reserves is equivalent to 34 percent of the country’s gross domestic product (GDP).
International reserves guarantee foreign currency availability in unusual situations that might occur due to external shocks resulting in eventual and possible withdrawals of foreign currency deposits and a subsequent capital flight from the financial system.
Also, adequate availability of foreign exchange reserves helps reduce country risk, with the subsequent improvement of the country credit ratings and better conditions to expand foreign investment in the country.
International reserves are particularly important in a context of globalization of international markets, reduction of barriers to capital flows and volatility of financial, foreign exchange and metal markets.
Source: Andina
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