The decision of the Russian authorities to invest in gold turned out to be a clever move. The price of the precious metal is soaring. In just one week, the Russian treasury expanded by $9 billion thanks to a record spike in gold prices. According to the estimates of the Bank of Russia, on July 31, the country’s international reserves amounted to $591.8 billion increasing by $9.1 billion, or 1.6%, in just a week because of an upward adjustment of the exchange rate and the surge in the price of gold. As a result of a stable rally, the value of the safe-haven asset in Russia’s international reserves jumped to $100 billion and it now makes up about 18% of all reserves. Nowadays, Russia’s gold reserves exceed 2,000 tonnes. In addition, the government’s decision to replenish stocks with gold is beneficial for local banks as they have started to purchase gold from national companies.
Overall, for the March-May 2020 period, gold exports from Russia increased by eleven times to $4.2 billion. The country sold a total of around 68.7 tonnes of gold for the same period. For the first time since 1994, Russia’s export of gold overtook exports of gas. In 2019, the country expanded gold exports by 8.4 times up to 116.075 tonnes from 13.87 tonnes in the previous year.
