Foreign reserves are used to:

Question

Quizplus · Accepted Answer

Foreign reserves are held by central banks and are used to cover foreign debt, import purchases, and other demands for foreign currency that banks might encounter. It helps to stabilize the currency value and to ensure stability in the international market. Foreign reserves are not used to provide military support or to help foreigners who need additional funds. Similarly, it is not intended to support foreign operations that are branches but not subsidiaries.

Foreign Reserves Are Used To