Dollar detox: Russia's gold reserves near 2000 tons to set historic benchmark
Russia’s gold holdings are approaching the Soviet era record after the central bank added another 106 tons of bullion in the first half of the year. It’s part of a plan to diversify national reserves away from the US dollar.
The entire gold reserve of the Russian Federation is nearing 2,000 tons with the share of the precious metal in the country’s foreign-exchange portfolio reaching a record 18 percent in June. At the same time, the Central Bank of Russia (CBR) launched a massive sell-off of US Treasury bonds, having dumped nearly all of the country's holdings.
The latest data from the US Treasury showed that Russia reduced its holdings from $96.1 billion in March to just $14.9 billion in May, having dropped out of the list of the 33 largest foreign holders of US sovereign bonds. The decrease reportedly occurred after the financial, economic, and geopolitical assessment by the CBR. The step helps Russia to diversify its reserves, according to the head of the regulator Elvira Nabiullina.
The current gold holdings of 2,000 tons are approaching the Soviet maximum of 2,800 tons reached in 1941. At the moment, Russia’s gold and foreign currency holdings total $460 billion with the central bank aiming to increase that figure to $500 billion. Over the last decade, the share of gold in reserves has soared tenfold.
The precious metal has historically proved itself as an effective hedge against financial shocks and fiscal meltdowns. According to mining and financial experts, the world could run out of mineable gold in the next two decades. If this happens, the prices for bullion could soar to $3,000 per ounce or higher.
For more stories on economy & finance visit RT's business section