Russia bought almost 160 tonnes of gold in 2019

Russia has bought 158.6 tonnes of gold in the past year, according to New figures of the central bank. In December, the central bank bought 9.33 tonnes of gold, the same as in the months of October and November. The country continues to expand its gold reserves, but at a significantly slower pace than in previous years. In 2018, the central bank bought a record amount of 273 tonnes. With last month's purchase, the gold stock rises to more than 2,270 tonnes, good for a market value of $106 billion.

The Russian central bank's gold strategy has not done the country any harm, as the Gold price has risen sharply over the past year. In the past year alone, this has resulted in $20 billion in value appreciation. At the moment, the central bank holds about a fifth of its reserves in the form of precious metals, compared to only 3% at the outbreak of the financial crisis.

Russia continues to expand gold supply

For central banks, the gold stock serves as a safe haven and protection against the risk of foreign exchange reserves. Physical gold in one's own vault has no counterparty risk and also offers protection against a possible depreciation of foreign exchange reserves. It is known that Russia has reduced its exposure to the dollar in recent years, converting dollar reserves into gold and other currencies. For example, the central bank has $101 billion in dollars in two years Converted to euros, Chinese yuan and Japanese yen.

Russian President Putin Said in 2018 at an investment forum in Moscow that uncertainty about dollar payments is reason for many countries to switch to other reserve currencies. Therefore, they are reducing dollar reserves in favor of other currencies and are increasingly trading in local currencies.

Gold does not currently play an active role in central bank reserves. It is not used for payment transactions and is therefore only there for a possible emergency scenario. Seen in this context, it is striking that central banks have been able to Buying more and more gold.

Gold and foreign exchange reserve Russia

Development of gold stocks and gold value

Gold as a percentage of total reserves Russia

Russia bought less gold in 2019 than in previous years