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Russia buys record amount of gold

Sunday, 01 February 2015 3:23 PM [ Last Update: Sunday, 01 February 2015 3:22 PM ]

Russia increased its gold purchase by 123% last year in an attempt to reduce reliance on the dollar.

Central Bank of Russia spent over USD6 billions on gold purchases last year in an attempt to shift away from a dependency on the dollar.

According to research by Thomson Reuters GFMS, Russia accounted for nearly one-third of the central banks 461 ton gold purchase.

Russia’s central bank bought 152 tons of gold worth USD6.1 billions in the first 11 months of 2014, showing a substantial 123% increase compared with the previous year.

It’s the most Russia has spent on the yellow metal since the break-up of the Soviet Union.

An economic expert predicts that Russia will sell its dollar assets and purchase more gold to reduce dependence on the US dollar and provide support to the ruoble.

“That will be done both to protect the ruble and potentially to position the ruble as a reserve currency in the long-term, but also as a signal to Washington,” Mark O’Byrne of GoldCore, told RT.

However, analysts say Russia could slow gold purchases and become a seller if it continues to liquidate its reserves to protect its beleaguered currency.

Rouble has lost nearly half its value against the dollar in the wake of the US-led sanctions against Russia over the crisis in Ukraine.

Earlier this week, EU foreign ministers decided to extend the sanctions against Russia. However, they did not agree on imposing more sanctions against Moscow.

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