There are fluctuations in forex trade and the currency and exchange rates are not always the same. The market flourishes and thrives on these fluctuations. These result in gain or loss depending on the market value at a particular time. The country which keeps as sound currency reserve can also face losses in trade due to these fluctuations. The fluctuation os currency value of one country also becomes the reason for loss of the other. For example if a country A holds the currency reserve of country B and the country B faces loss, the country A will also see loss. It works in chain wise manner. The central bank continuously increases its reserves so that it can