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SA reserves fall on weak rand, lower gold prices

Staff Reporter

SA's gold and foreign-exchange reserves dropped from $33,6-billion to $32,1-billion in October, as the rand weakened and gold prices fell.

South Africa’s gold and foreign-exchange reserves dropped from $33,6-billion to $32,1-billion in October, as the rand weakened and gold prices fell, the central bank said on Friday.

“It is to be expected that significant changes in the value of the United States dollar and the dollar price of gold will from time to time lead to sizeable valuation impacts,” the Reserve Bank said in statement.

Net foreign-currency holdings decreased to $29,97-billion, a $900-million drop, the bank said.

Gold reserves fell to $2,943-billion, down $616-million.

The rand has lost about 46% of its value against the dollar this year. The dollar’s gains serve to weaken the value of reserves held in other currencies.

Falling gold prices have also hit the value of South Africa’s reserves. Gold traded at more than $900 an ounce in January, but on Friday afternoon was quoted at $741,60 an ounce in Johannesburg.

Gold is South Africa’s biggest foreign-currency earner. In 2007, China surpassed South Africa as the world’s biggest gold producer.—AFP

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