Foreign-exchange reserves play a crucial role in a country’s economic and financial stability. These reserves are made up of foreign currencies, bonds, treasury bills and other government securities that are held by a nation’s central bank. Holding significant foreign reserves benefits a country in several ways, such as backing the local currency, paying foreign debt obligations, intervening in forex markets to influence exchange rates, and providing confidence to foreign investors.

In today’s global economy, forex reserves are seen as an important indicator of a country’s economic standing and creditworthiness. Nations with robust reserves are viewed favorably in global markets, attracting more foreign capital inflows, investment and trade. On the flip side, dwindling reserves signal potential trouble ahead, deterring foreign investors.

This article will examine the countries holding the largest foreign-exchange reserves as of August 2023. We’ll look at the top 20 reserve holders, discussing key details and changes over the past year. Understanding the global forex reserve landscape provides valuable insight into relative economic power and stability.

1: China Tops the List by a Wide Margin

China possesses the world’s largest foreign-exchange reserves by far, totaling over $3.2 trillion as of August 2023. This enormous war chest has enabled China to become an economic and geopolitical powerhouse, while also providing a substantial financial buffer against crisis.

Despite global headwinds, China continues accumulating forex reserves at a rapid pace. Over the past year, the country’s reserves have climbed by over $130 billion. Ongoing trade surpluses and substantial foreign investment inflows have expanded China’s coffers.

The Chinese government has leveraged these reserves strategically to support the yuan and further the country’s emergence as a global financial hub. China’s towering reserves also reassure investors and trading partners, signaling economic resilience even amid recent slowing growth.

2: Japan Holds the Number 2 Spot

Japan possesses the second-highest level of foreign-exchange reserves, totaling around $1.3 trillion as of August 2023. While dwarfed by China’s stash, this still represents a sizable war chest that underpins the yen’s status as a major global currency.

In contrast to China’s ascent, Japan’s reserves have edged down slightly over the past year as the government tapped this funding source. Japan relies on its vast forex reserves to intervene in currency markets when extreme yen volatility threatens economic stability.

Holding ample reserves remains a priority for Japan given risks like rising geo-political tensions, energy price spikes, and the country’s lingering deflationary pressures. Japan’s deep reserves assure currency traders and foreign investors alike.

3: Switzerland Has the Third-Largest Reserves

Boasting nearly $1 trillion in foreign-exchange reserves, Switzerland takes the number three spot. The Swiss National Bank has accumulated a massive stockpile of foreign bonds, equities, and other assets held in foreign currencies.

Switzerland’s reserves expanded over the past year as continued haven demand for the Swiss franc compelled the central bank to intensify currency intervention. This entails selling francs to dampen excessive appreciation.

Forex reserves in Switzerland now amount to over 100% of the country’s annual GDP. This highlights the nation’s exceptional reliance on reserves to temper its currency’s safe haven volatility amid global unrest.

4: India’s Reserves Make It a Global Powerhouse

Emerging market giant India comes in fourth place with total foreign-exchange reserves of approximately $630 billion as of August 2023. This represents a slight decrease from last year’s peak, but reserves remain elevated.

Robust reserves underscore India’s increasing prominence in the global economy. The government has used reserves to moderate rupee exchange rate fluctuations amid periods of market turmoil. Reserves also enable India to pay for critical imports like oil, gold and fertilizer.

India’s deep forex stash signals the nation’s economic vibrancy and resilience. It provides reassurance to foreign investors and ratings agencies alike. Expect India to continue accumulating reserves as its current account balance trends positive.

5: Russia Still Holds Sizable Reserves Despite Sanctions

Despite a barrage of economic sanctions imposed due to its invasion of Ukraine, Russia continues to hold substantial forex reserves totaling around $580 billion. This represents a significant decline from over $640 billion a year ago after blocks on Russian assets and trade took their toll.

Russia tapped its reserves to reduce market chaos and backstop its banking system as sanctions roiled its economy. Going forward, remaining reserves will allow Russia to partly manage exchange rate volatility and pay foreign obligations.

However, sanctions continue to severely limit Russia’s ability to expand reserves. Diminished reserves combined with restricted access to global markets will hamper Russia’s economy, exports and fiscal options long-term.

6: South Korea Reserves Highlight Export Strength

Known for world-leading technology and manufacturing exports, South Korea holds over $450 billion in foreign-exchange reserves as of August 2023. This represents an increase from approximately $440 billion a year earlier.

Robust reserves provide South Korea with an important buffer against external shocks and exchange rate volatility. The government draws upon reserves to moderate won currency swings during periods of market turmoil and risk aversion.

South Korea should remain capable of expanding reserves in the future given its strong export industries, trade account surplus, and attraction for foreign investment capital. Reserves also allow South Korea to secure ample imported raw materials and energy.

7: Brazil’s Reserves Provide Stability

Brazil possesses Latin America’s largest foreign-exchange reserves stockpile, totaling around $350 billion as of August 2023. Reserves are down modestly over the past year but remain elevated. The government strives to expand reserves during periods of export strength.

Holding ample reserves helps Brazil limit currency weakness and volatility. The government has intervened in forex markets on several occasions to support the Brazilian real. Reserves also enable Brazil to pay foreign debt and secure critical commodity imports.

Brazil’s reserves additionally provide reassurance about the country’s relative stability amid bouts of political uncertainty. Robust reserves should support higher sovereign credit ratings for Brazil going forward.

8: Forex Reserves Support the Canadian Dollar

Canada holds over $325 billion worth of foreign exchange reserves, representing a slight increase from the prior year. The Bank of Canada manages reserves to provide backing for the Canadian dollar and fund currency interventions when extreme volatility hits.

Canada has tapped its reserves at times to temper excessive strength in the Canadian dollar driven by spikes in oil exports or global haven demand. This leaning against currency appreciation prevents damage to Canada’s manufacturing and export competitiveness.

Reserves also enable Canada to smoothly participate in foreign trade and international commodity markets. Canada’s ample stash highlights its economic resilience.

9: Taiwan Reserves Rise Despite Geopolitical Tensions

Taiwan grew its foreign-exchange reserves to around $320 billion by August 2023, up from roughly $300 billion a year earlier. This growth came despite rising geopolitical tensions stoking haven demand for Taiwan’s dollar.

To prevent excessive currency appreciation, Taiwan tapped its reserves to buy and sterilize surplus dollars. The government aims to maintain a competitive exchange rate to support the nation’s vital export industries.

Holding sizable reserves also enables Taiwan to weather episodic market unrest stemming from cross-strait relations with China. Going forward, reserves provide Taiwan with an important financial buffer as tensions remain elevated.

10 Saudi Arabia Leans on Oil Revenue

Saudi Arabia holds over $450 billion in foreign-exchange reserves as it remains highly dependent on oil export revenues. Reserves dropped from a peak above $500 billion in 2021 after the government drew on this funding to counteract pandemic impacts.

The Saudi government utilizes reserves to smooth volatility in the riyal while also supporting the national budget during periods of lower oil prices. This buffer remains vital given the economy’s outsized exposure to oil.

If oil markets tighten and prices spike higher, Saudi Arabia will likely rebuild its reserve cushion. However, reserves may face pressure if global growth slows and energy demand declines.

11: Hong Kong Reserves Cushion Financial Hub

Hong Kong’s nearly $500 billion in foreign-exchange reserves highlight its status as a global financial center. Reserves provide vital backing for the Hong Kong dollar’s peg to the U.S. dollar. To maintain the peg, Hong Kong utilizes reserves to buy local currency when needed.

Holding robust reserves also enables Hong Kong to weather capital outflows during periods of market stress or unease over political tensions with China. Given Hong Kong’s role as a trading hub, ample reserves remain critical.

Hong Kong grew reserves over the past year thanks to continued haven inflows. Looking ahead, lingering economic uncertainty may test the peg and reserves at times.

12: Singapore Bolsters Status as Financial Hub

With over $350 billion in foreign reserves, the small nation of Singapore ranks among the world’s top reserve holders in relation to GDP. Reserves provide key support for the Singapore dollar and backstop the country’s status as a global finance hub.

Singapore collects reserves from trade account surpluses, substantial inward investment, and occasional currency intervention. During market turbulence, Singapore refrains from excessive intervention to allow the exchange rate to absorb shocks.

Healthy reserves reinforce Singapore’s economic resilience and sovereign credit profile. Maintaining robust reserves will remain a priority for Singapore amid periodic volatility episodes.


A country’s stockpile of foreign-exchange reserves offers an important indication of its economic standing and resilience to external shocks. The world’s leading reserve holders in 2023 highlight a shifting balance of global economic power.

China has amassed an unrivaled trove of reserves as it ascends on the world stage. Meanwhile, Japan and Switzerland rely on their deep reserves to support major currencies like the yen and franc that remain closely tied to global market volatility.

Emerging markets like India, Brazil and South Korea leverage reserves to manage exchange rates, pay foreign debts, and secure critical imported resources. Leading financial hubs like Hong Kong and Singapore use reserves to defend currencies and reinforce stability.

Understanding the distribution of global foreign exchange reserves provides key insights into relative economic strengths and vulnerabilities. Reserves will continue playing a vital role in shaping global financial developments in the years ahead.