Gold outstrips the US dollar as Russia’s foreign reserves

On January 11, the Bank of Russia published the “Foreign Exchange and Gold Asset Management Report“. According to the report, Gold has outstripped the US dollar in value as Russia’s foreign reserves for the first time in history.

As of June 30, 2020, the Gold reserve was worth $128.5 billion, accounting for 22.9 per cent of the total foreign reserves of $561.1 billion. US dollar assets were worth $124.6 billion (22.2 per cent). Before 2018, US dollar assets usually accounted for more than 40 per cent of Russia’s foreign reserves.

Overall, the Euro has the largest share at 29.5%, followed by the Gold (22.9%), the US dollar (22.2%), the Chinese yuan (12.2%), the British sterling (5.9%) and Japanese yen (3.9%).

This composition reflects the Bank’s attempt to diversify away from the US dollar after the economic sanctions and the dramatic appreciation of the Gold’s price (the Bank has not purchased any gold since April 2020).

The Bank held about $100 billion of US treasuries as recently as early 2018, but according to the US data, the amount declined to 6 billion at the end of October 2020.

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