Taipei: Taiwan's foreign exchange reserves reached US$602.55 billion at the end of December, marking the second highest level ever recorded and solidifying the nation's position as the fourth largest holder of forex reserves globally, as reported by the local central bank on Tuesday. According to Focus Taiwan, data compiled by the central bank indicated that the country's forex reserves increased by US$2.76 billion from the previous month, surpassing the US$600 billion threshold. This figure is second only to the record high of US$602.94 billion achieved at the end of September. Taiwan ranks behind China (US$3.35 trillion as of November), Japan (US$1.16 trillion as of November), and Switzerland (US$903.5 billion as of November) in terms of forex reserve holdings. Tsai Chiung-min, head of the Foreign Exchange Department, explained that the decline of the U.S. dollar index by 1.14 percent in December led to an appreciation of other major non-greenback currencies, enhancing the central bank's portfolio when co nverted into U.S. dollars. Although the central bank intervened in the market during December to mitigate the volatility of the Taiwan dollar, the intervention was minimal and did not significantly impact the month's forex reserves. In earlier months, specifically May and June, the central bank intervened by purchasing U.S. dollars to prevent the appreciation of the local currency, which contributed to the growth of the forex reserves. Despite the Taiwan dollar's stability in subsequent months, the reserves continued to grow owing to increased returns from the central bank's portfolio management, with September's figures setting a new record high. Tsai noted that recent trading sessions saw limited remittance of large funds by foreign institutional investors into or out of the local market. However, he cautioned that Taiwan Semiconductor Manufacturing Co. is scheduled to pay substantial cash dividends on January 8. If foreign investors choose to move their dividend payouts out of Taiwan rather than reinvest ing in the local stock market, it could impact the local forex market. The central bank's data also revealed that foreign investors held US$1.15 trillion in Taiwan-listed stocks, bonds, and Taiwan dollar deposits at the end of December, an increase from US$1.09 billion in November. These holdings represented 191 percent of Taiwan's total forex reserves in December, up from 182 percent in November, following a 4.84 percent rise in the Taiwan Stock Exchange's benchmark Taiex. In a joint statement with the U.S. Treasury Department to enhance market transparency, the central bank disclosed its intervention activities on a quarterly basis-in January, April, July, and October. The bank reported that it had purchased US$1.287 billion more U.S. dollars than it sold during the third quarter of the previous year. Previously, such figures were released every six months.