Bank for International Settlements, The Per Jacobson Lecture, June 27, 2004, p. 9. BIS Review 41/2005  5
The goal is no longer managing the value of the currency. Instead, reserves serve to bolster the national balance sheet, reassuring investors that the country has access to safe, liquid resources even in extreme situations. The use of reserves is therefore very different. The reserves provide insurance, a guarantee that markets will be able to price exchange rates.