## Figure 1.17. Reserve Buffers and Potential Foreign Exchange Liquidity Needs

## Source details

**Canonical URL:** [Figure 1.17. Reserve Buffers and Potential Foreign Exchange Liquidity Needs](https://www.imf.org/-/media/files/publications/gfsr/2018/oct/ch1/pdf/figure1-17.pdf)

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### 1. Key messages and vulnerabilities
- Large short-term debt liabilities to foreigners or a loss of export income could lead to substantial foreign exchange liquidity needs.
- Countries with a high share of short-term foreign currency debt liabilities are most vulnerable to portfolio outflows.
- Derivatives-related liabilities not captured by reserve adequacy metrics could lead to a sudden increase in foreign exchange liquidity needs.

### 2. Panel descriptions and metrics
- Panel 1 — Potential Balance of Payment Drains
  - Unit: Percent of gross foreign exchange reserves.
  - Note: Countries in red have reserves below 100 percent of ARA metric.
  - The indicators are adjusted using the ARA weights.
  - The numbers are as of end 2017.
  - The ARA metric (panel 1) reflects potential balance-of-payment FX liquidity needs in adverse circumstances and is used to assess the adequacy of FX reserves against potential FX liquidity drains (see IMF 2015b).
- Panel 2 — Composition of External Liabilities
  - Unit: Percent of GDP.
  - Liability categories shown in the figure:
    - Short-term FX debt
    - Long-term FX debt
    - Local currency debt
    - Equities
    - FX instruments settled by other means (for example, domestic NDFs)
    - Contingent short-term drains of FX liabilities
    - Aggregate net FX forward position
    - FX loans, securities, deposits
- Panel 3 — Reserves and Potential Foreign Exchange Drains Due to the Use of Derivatives
  - Unit: Percent of gross foreign exchange reserves, latest 2018 figures.
  - In panel 3, NDFs are nondeliverable forwards where counterparties settle the difference between contract rate and the prevailing rate without exchanging the notional value.

### 3. Country labels and sample identifiers shown in the figure
- Country ISO codes and labels appearing in the figure include: ARG, TUR, ZAF, RUS, ROM, POL, HUN, PER, MEX, COL, BRA, THA, PHL, MYS, IDN, IND, CHN, COLTURARGPERPOLRUSBRATHAZAF, MYS, RUS, PER, CHN, PHP, CHL, POL, BRA, HUN, ROM, COL, IND, MEX, TUR, ZAF.
- Time labels appearing in the figure: 2013:Q1, Latest, 13:Q1, 14:Q2, latest 2018 figures.

### 4. Visual scale markers and numeric references displayed
- Horizontal/vertical scale ticks and labels shown in the figure include: 0, 5, 10, 15, 20, 25, 30, 40, 50, 60, 80, 100, 125, –20, 20, 30, 40, 50, 60, 80.
- Example axis phrases as shown: "Higher risk of external demand shock", "Higher portfolio outflow and debt rollover risks", "Higher reliance on equity and local currency liabilities".
- Export income (adjusted) scale shown as: 0 25
- Short-term debt and other liabilities (adjusted) scale shown as: 50 75 100 125

### 5. Notes and data sources
- Sources: Bloomberg Finance L.P.; Haver Analytics; and IMF staff estimates.
- Acronyms: ARA = assessment of reserve adequacy; FX = foreign exchange.

*Source: figure1-17*

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_Source: https://www.imf.org/-/media/files/publications/gfsr/2018/oct/ch1/pdf/figure1-17.pdf_