Official reserve account


A silly question on country’s balance of payments.

Current Account = 100, Financial Account = -40, Official Reserve Account = -60, Total sum = 0

I understood that change in official reserve maintains the balance to 0.

When there is a trade surplus of 100-40 = 60, why would it decrease the Official reserve account by 60? I didn’t understand the true intent of that -ve sign?

In case of trade deficit, the official reserve will supply the funds and -ve sign makes sense. But there is a trade surplus here? Any thoughts?

Thank you.

As i understood we treat the reduction of official reserves with positive sign, because it is a source of foreign currency, so increase is treated with “-” sign. more info on p.657, 659 (exibit).