The largest buyer of gold in the world over recent years has been the Bank of Russia. According to the latest data, on July 1, 2019, the gold reserves of our country grew and amounted to $ 100.3 billion. This has led to the fact that now the gold and foreign exchange reserves of the Russian Federation consist of 19 percent gold.
The reason for the increase in the gold reserve
The departure to gold on the part of strategic factors is reasonable. Now the world is on the verge of a new era, which is characterized by instability and the possibility of a repeat of the global crisis. That is why precious metals are considered the most liquid and reliable assets.
Russia's gold reserve has increased not only due to the fact that the Central Bank purchased gold, but also due to an increase in the value of the precious metal. According to statistics, gold since the beginning of the year has risen in price by more than 10 percent. This price increase was triggered by the aggravation of the trade conflict between China and the United States. As a result, the price of the precious metal reached a six-year high last month.
Last year results
Last year, the Central Bank was able to purchase 8.8 million ounces of gold. This led to an increase in reserves to 67.9 million ounces. As a result, Russia was able to enter the top five countries in terms of the total amount of gold and overtake China.
The three largest holders
According to preliminary data, a rapid breakthrough in Russia, while maintaining the pace, could lead to the fact that our country will be able to accumulate gold and in three years rise from fifth to third among the largest holders of this precious metal, as well as update the record of the Soviet period in one decade.
But despite such bright prospects, countries will not be able to completely abandon the dollar. This is primarily due to the fact that Russia needs to support import and export operations denominated in dollars. That is why a substantial part of the reserves of the Russian Federation should be in US currency.
Rapid rise in gold price
According to preliminary forecasts by experts, in the coming years, global gold production will begin to decline. It is estimated that by 2022 the production of the precious metal will drop to the level of the beginning of the 21st century. This situation will occur as a result of the fact that gold reserves in the earth's bowels will be exhausted by 2034. All these events will lead to the fact that the cost of the yellow metal will creep upward. Estimated cost will average about 2-3 thousand dollars per ounce.