South Korea's foreign exchange reserves dropped to 200.51 billion U.S. dollars in November, down 11.74 billion U.S. dollars from a month earlier, the Bank of Korea (BOK) said Wednesday.

"Despite higher investment profits and an early end of currency swap deals with the state pension fund, foreign reserves declined as authorities expanded the dollar supply to the banking sector in a bid to calm jitters sparked by the global credit crunch," the BOK said.

South Korea's currency market has been suffering from a dollar shortage as companies hoarded the safer greenback on concerns of a global financial crisis.

In a bid to lease an ongoing credit crunch and financial jitters, the BOK injected around 7.5 billion U.S. dollars to the market mainly through swap deals in November. In October and November, the central bank supplied around 10.2 billion U.S. dollars to the market, the BOK said.

The government also supplied 6.7 billion U.S. dollars to the market through the state-run Export-Import Bank of Korea last month, according to the BOK.

The BOK said a possible liquidity injection by authorities in the future may not be as large as tightened overseas borrowing conditions are likely to ease while the country's current account balance is expected to post a surplus in coming months.

(Xinhua News Agency December 3, 2008)