GoldCore

– Russia buys 300,000 ounces of gold in March and nears 2,000t in gold reserves
– Russia now holds just over 1,861 tonnes, more than officially reported by China at 1,842t
– Both Russia and China have the power to destabilise US dollar by dumping dollar-denominated assets
– Turkey has removed all gold held in the U.S. opting for Bank of England and BIS 
– Turkey follows trend set by both Germany, Netherlands and others to remove gold reserves stored in the United States
– Central bank decisions regarding gold reserves are examples of countries becoming nervous about the outlook for the dollar under the Trump administration

Russia bought another 300,000 troy ounces of gold in March bringing Russia’s total gold reserves to 1,861 tonnes or 60.8 million troy ounces as of the start of April, the central bank announced loudly at the weekend.

The continuing robust and steady accumulation of gold reserves continues and it was notable how Russian media channels loudly (more loudly than usual it seemed with many outlets covering) pronounced the continuing diversification into gold bullion by the Russian central bank. It suggests that gold is being used as a bulwark to protect Russia from the stealth financial, trade and currency wars which appear to be deepening.

Russia is not the only country diversifying into gold and many other countries are doing so as they seek to protect themselves from the coming devaluation of the US dollar and U.S. dollar hegemony. This is evidenced both by gold purchases and also in many strategic decisions regarding the storage of national gold reserves.

While Russia was adding to its gold reserves, taking it above China’s holdings, Russia’s new ally Turkey was busy removing all gold bullion reserves held in the United States.

Both are clear moves against US dollar hegemony. Gold reserve changes combined with the news that Russia and China have agreed to settle some trades in ruble and yuan is a clear step that the world’s super powers are looking to reduce dependence on the US dollar and the increasing move away from the US dollar as global reserve currency.

Whilst it can be difficult to look past the Western media rhetoric regarding the likes of Russia, Turkey and China, there are lessons to be learnt by the everyday investor and saver.

These moves have also been seen by western nations such as the Netherlands and Germany who recently made the decision to bring some (if not all) of their reserves back to Europe.

The Gold Mission 

Putin has long been on a mission to build up the country’s gold reserves after previous Russian governments ran the country’s reserves down to less than 300 tonnes.

The current president has made it clear that the country should be holding gold, rather than US dollars. For many years, the Russian central bank has consistently bought gold, driven by Putin’s believe in the financial sovereignty offered by gold and its protection against geopolitical and economic risks.

“Under the instruction by President Putin, the Bank of Russia has been implementing the program of increasing the absolute share of gold in the gold and currency reserves of Russia for many years.”
First Deputy Chairman of the Russian regulator Sergey Shvetsov

Putin first came to power in 2000 and since then the country has had more months than not, when it has purchased gold bullion. A large jump in reserves was seen in 2014 after Western sanctions were imposed and Russia has been the world’s largest gold buyer ever since. It is now the fifth largest gold holder after the United States, Germany, Italy, and France.

Russia is also the third largest producer of the precious metal. As a result, the majority of its purchases are locally sourced, giving the country an additional edge when it comes to protecting its finances. This is something that China is also wise to. It does not allow the export of any gold mined in the country, further evidence of the desire to protect the country’s financial system and economy and position the yuan as an alternative to the dollar in the long term.