According to the latest report from the Russian central bank, Russia now holds more gold than US dollars in its reserves for the first time. Russian President Vladimir Putin has made his country’s main policy of reducing the exposure of the Russian economy to the US dollar under severe sanctions.
Russia now has more gold in its reserves than US dollars
According to a report released this week by the Bank of Russia, gold is said to have surpassed US dollars in Russia’s $ 583 billion reserves for the first time. The country has increased its international reserves in recent years.
The report shows that gold made up 23% of the central bank’s reserves on June 30, 2020, Bloomberg reported, citing the latest data with a breakdown. The US dollar’s share of reserves has fallen to 22% from over 40% in 2018. The euro made up about a third of total assets, followed by gold which is now the second largest component. About 12% is in the Chinese yuan.
The rise in the gold component of reserves is driven by the 26% rise in the metal price between June 2019 and June 2020, the publication said. The report also reveals that the central bank bought $ 4.3 billion worth of gold over the period.
Russia became the world’s largest gold buyer after spending more than $ 40 billion on gold in the past five years. The central bank said 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.
Russian President Vladimir Putin has made de-dollarization of his country the main policy in an effort to reduce the exposure of the Russian economy to dollar assets. The multi-year effort to reduce Russia’s vulnerability to US sanctions comes amid deteriorating relations with Washington.
News.Bitcoin.com reported last August, Russia and China had worked together to reduce their dependence on the US dollar, and USD trade arrangements between the two countries had fallen below 50%.
What do you think about Russia’s efforts to reduce the dollar? Let us know in the comments below.
Image Credits: Shutterstock, Pixabay, Wiki Commons, Bank of Russia, Bloomberg
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