News Bites
Russia's National Wealth Fund piles into gold
(Kitco News) - Last Friday it was noted that the Russian National Wealth Fund announced its intention to move into gold. This week we have heard some more detailed information about the move and could have something to do with the de-dollarization of Russia.
Last month (February), it was noted that the Ministry of Finance in Russia restructured its National Wealth Fund to reduce its USD and EUR holdings from 45% to around 35%. There was some flow into JPY and CHY with the holdings in GBP remaining at 10%. The National Wealth Fund was made to support the countries national pension system. Its profits can also be used to cover budget deficits in tough times and as of 1st November 2020 the assets amounted to more than $167 bln which is around 12% of Russia's GDP.
The Central bank of Russia is said to have bought an average 205 tonnes every year since 2014 but last year, accordingWGC data, they bought just 27 tonnes. Overall, in January the value of Russian gold in its forex reserves surpassed the country’s U.S. dollar holdings for the first time, according to Russia’s central bank.
At that time the value of the gold holdings amounted to $128.5 billion versus the $124.6 billion held in U.S. dollars.
