Emerging Markets Buy Cheap Dollars to Build Reserves

Nations from Colombia to Indonesia are taking advantage of the longest emerging-market currencies rally since 2009 to pile up record reserves, bolstering their ability to fend off the next foreign-exchange crisis. The 12 developing nations with the biggest foreign reserves outside of China added $34 billion in the past three months, lifting their combined holdings to $2.98 trillion on April 30, the most since Bloomberg began compiling the data in 2008. A gauge of 20 emerging-market currencies is recovering after tumbling in February to the lowest level since April 2009.

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-Igor P Purlantov