However, countries which have difficulties in accumulating reserves, through normal transactions activities, will make vigorous attempts to increase their holdings. BIS Review 1/2006  1  Why we need foreign exchange reserves Though traditionally, foreign exchange reserves were used to intervene in the foreign exchange markets, over the years the frequency of intervention by central banks in developed hard currency markets has waned.
Third, as was the focus of my remarks two years ago, in addressing financial crises, international cooperation can be very helpful; indeed, given the global integration of financial markets, such cooperation is essential. Central bankers worked closely together throughout the crisis and continue to do so.