Russia has been building its gold reserves as part of a continuing effort to reallocate its reserve portfolio.
“Russia has been aiming to diversify its forex reserves for some time, but that process was accelerated by sanctions against the country last year,” said Martina Bozadzhieva, head of research for Europe, Middle East and Africa at Frontier Strategy Group.
Russian central bank official Dmitry Tulin said in May that the Central Bank of Russia (CBR) will bolster its gold holdings as the asset is safe from “legal and political risks,” according to media reports.
“Ramping up gold reserves can help to offset capital outflows from Russia, which also faces declining disposable income and consumption as unemployment rises,” said Haley.
“The country already holds more gold than it did a year ago even as total currency reserves are far from recovered,” said Bozadzhieva.
The CBR boosted its gold reserve by $350 million in June to $48.229 billion, according to data from the bank. Gold accounted for 13.3% of its total reserves at the end of last month, up from 9.7% in June 2014.
Full article: Russia is boosting its gold reserves as prices plunge (MarketWatch)