The power of the US dollar and its dependence on it are a thorn in the side of many states. Precisely because the geopolitical conflicts in the United States are accompanied by strict economic sanctions and a dominant currency. The global monetary system has been revolving around the United States and its US dollar continuously since the end of World War II. The US currency accounts for 70 percent of global payments. To escape this “annoying straitjacket”, more and more central banks are stocking up on gold.
Russia’s gold purchases increased immensely – what is behind it?
In addition to Turkey and China, Russia, arguably the largest geopolitical opponent of the United States, has been in the top regions of the top 10 countries for years, which are steadily increasing their gold reserves. After the final collapse of the Soviet Union in December 1991, Russia’s gold inventory dropped to a meager 290 tons. Then it went up steadily. The Central Bank of Russia began to get rid of its dollar reserves in 2014. Russia’s deposits in US state schools fell from $ 176 billion to $ 14.9 billion. After the Washington sanctions in 2018, there was a massive sell-off. At the same time, Russia’s central bank increased its gold reserves – knowing that gold as a stateless currency is becoming increasingly expensive.
Gold has been one of the most sought-after precious metals for centuries. For Russia and other countries, gold is the safeguard that does not lose value against crises and inflation in times of fiscal uncertainty. In addition, countries like Russia can use gold as an alternative currency to compensate for trade inequalities. Russia’s central bank is also committed to this protection. It is increasingly relying on bars as protection against the world’s most important trading currency, the dollar. Russia’s gold purchases skyrocket year after year. Russia has quadrupled its gold reserves at the fastest pace in more than ten years. According to the motto: Away from the dollar – whatever the cost. And in this investment strategy, Russia also benefits from the trade war between the United States and China. Russia is behind Turkey, followed by Poland and China in second place among the central banks with the most gold purchases (volume in tons) in 2019.
The top 10 gold sales central banks 2019 are:
|1. Turkey||159,0 t|
|2. Russia||158,1 t|
|3. Poland||100,0 t|
|4. China||95,8 t|
|5. Kasachstan:||35,0 t|
|6. India||32,7 t|
|7. VAR||13,5 t|
|8. Qatar||11,0 t|
|9. Ecuador||10,6 t|
|10. Serbia||10,0 t|
Uzbekistan (19.3 t), Germany (3.2 t), the euro area (2.5 t), Czechoslovakia (0.8 t), Tajikistan (0.4 t) and up sold the most gold in 2019 8th place Romania (01 t).
The largest gold reserves worldwide are the USA (8,133.5 t), Germany (3,366.5 t) and the IMF (International Monetary Fund; 2,814.0 t). Russia is 6th with 2,271.2 t.
Born 1981 in Strasbourg, is a freelance journalist for various online media throughout Europe, focusing on finance, real estate and politics. He gathered his professional expertise as a consultant for global players and medium-sized companies. Fournier studied economics and german in Paris and Dresden. He currently lives in Saarland and has been a member of the Euro Leaders team since the beginning of 2019.