Regulator says Russia buying gold at ‘record pace’

Regulator says Russia buying gold at ‘record pace’

Russia’s campaign to expand its deposits of gold is meant to help protect it against US sanctions as well as economic and geopolitical risks.
Russia’s campaign to expand its deposits of gold is meant to help protect it against US sanctions as well as economic and geopolitical risks.

The latest market figures show Russia has increased its purchases of gold to record highs in what appears to be part of the country’s policy to cushion itself against the sanctions of the United States. 

Figures released by the World Gold Council (WGC) show that the Central Bank of Russia bought 63 tonnes of the precious metal in the third quarter of 2017. The WGC added in a statement that the Russian stockpile of the bullion had already reached 1,778.9 tonnes as of the end of September.

In September only, the regulator added 34.6 tonnes of bullion to its reserves, in the highest monthly increase since October 2016, reported the Russian news website Sputnik News citing the country’s business newspaper Kommersant.

Currently, the Russian Central Bank has been ranked sixth in the world in terms of bullion reserves. The top five are the United States (8,133.5 tonnes), Germany (3,373.7), Italy (2,451.8 tons), France (2,435.9) and China (1,842.6).

At the same time, according to the WGC, the Russian Central Bank is leading in terms of the pace at which it is stockpiling gold.

Russia’s campaign to collect gold is meant to enable the country to have guarantees amid the tightening of the US Federal Reserve’s policy and amid the growing tensions between Moscow and Washington. Russia also wants to protect its reserves against possible geopolitical risks.

Market analysts also suggest that the Russian Central Bank will continue to expand its gold reserves.

If the Russian Central Bank continues to buy gold at the same pace Russia is likely to topple China as the world’s fifth-biggest holder of bullion in early 2018, according to Kommersant.

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