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31 Dec, 2021 10:01

Russia keeps stockpiling gold & foreign currency

The country holds the world’s fifth-largest forex reserves
Russia keeps stockpiling gold & foreign currency

Russian foreign exchange holdings grew by 0.7% over the week ending December 24, reaching $630.5 billion, according to the latest data from the central bank. Russia holds the world’s fifth-largest forex reserves.

In monetary terms, the weekly growth of the country’s international reserves totaled $4.2 billion, the regulator said. The surge reportedly occurred as a result of planned purchases of foreign currencies and a positive market re-assessment.

Russia’s international reserves are highly liquid foreign assets consisting of monetary gold, foreign currencies, and special drawing rights, which are at the disposal of the Central Bank of Russia and the government.

In 2015, the reserves declined to a post-2008 low of $356 billion, after the government had to spend around $250 billion to bail out the economy during the 2014 oil price crisis.

Since then, Russia’s gold and foreign currency holdings have nearly doubled. They exceeded the target level of $500 billion set by the regulator in June 2019 and have remained above that threshold ever since.

In 2020, the holdings soared by 7.5% to $595.8 billion despite the impact of the coronavirus pandemic on the economy, which forced the government to increase spending to support businesses and households.

Last month alone, the reserves reached a record high of $626.3 billion, marking a weekly growth of $4.1 billion.

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