Russia continues to buy gold: 25 tonnes in March

Russia added nearly 25 tonnes of gold to its reserves in March, according to new Figures that the central bank released this week. To be precise, the central bank bought 800,000 troy ounces of gold (24.88 tons), bringing the country's total gold reserves to 1679.58 tons. In the first three months of this year, Russia has already added a total of more than 65 tonnes of gold to its reserves.

In 2006, the central bank of Russia began Buy gold, but has been doing so at a much faster pace since 2014. The most likely explanation for this is the deteriorating relationship with the West due to the developments in Ukraine. As a result, the risk of foreign exchange reserves has increased, because in theory they can be blocked more easily. Gold is a 100% insurance against political risk, because its value is not dependent on developments in other countries.

Russia keeps buying gold

The gold reserves of Russia have quadrupled in the past ten years, because in 2007 there were barely 400 tons of gold in the vault of the central bank. The value of this reserve has risen much more due to the rise in the price of gold, which increased from $10 to $67 billion in ten years. Russia now has more than 16% of its total reserves parked in the precious metal, its foreign exchange reserves consist mostly of euros and dollars.

Central banks have been net buyers of gold since the outbreak of the financial crisis, with the central bank of Russia accounting for the majority of the purchases. In addition to Russia, China and Kazakhstan are also important buyers in the gold market. Most of that gold comes from private gold reserves and new mining production, as central banks have virtually stopped selling gold in recent years.

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