Russia has explained the reason it acquired for the first time more of gold in foreign reserves than the United States dollars.
Russia’s central bank disclosed that President Vladimir Putin has made de-dollarization his country’s key policy to reduce the Russian economy’s exposure to the U.S. dollar amid heavy sanctions.
The latest report by Russia’s central bank added that Gold has reportedly surpassed U.S. dollars in Russia’s reserves of $583 billion for the first time.
Russia became the world’s largest gold buyer after it spent more than $40 billion purchasing gold over the past five years. The central bank said that it stopped buying gold in the first half of last year to encourage miners and banks to export more and bring foreign currency into the country.
The Bank of Russia published this last week shows that gold made up 23% of the central bank’s reserves as of June 30, 2020.
Also in Bloomberg detailed data breakdown, the share of the U.S. dollar in the Russia reserves has fallen to 22% from more than 40% in 2018.
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It said the euro made up about a third of the total assets, followed by gold which is now the second-largest component. About 12% is in the Chinese yuan.
The increase in the gold component of the reserves is boosted by the 26% surge in the price of the metal between June 2019 and June 2020, the publication added. The report also reveals that the central bank bought $4.3 billion worth of gold over the period.
