Russia and other countries formerly part of the Soviet Union continue to increase gold reserves at a steady pace.
Russia added another 34.2 tons of the precious metal in September. This follows on the heels of a 1 million ounce increase in Russian gold reserves in August, and continues a steady buying spree by the world’s seventh largest holder of gold in the world.
Since the global financial crisis, Russia has increased its gold reserves at an average pace of about 300,000 ounces per month.
Other countries formerly part of the Soviet Union are following suit.
According to Bloomberg, Kazakhstan increased its gold reserves for the 35th straight month in August. The country purchased about 2.1 tons to bring its stash to roughly 210.2 tons. Belarus also expanded its reserves to 47.1 tons that same month
The National Bank of Ukraine added 30,000 ounces of gold to its reserves in September, bringing its total stash to about 27 tons. The value of the country’s gold holdings grew by $41.96 million, to $989.78 million according to the official Ukrainian news agency.
Many analysts such as Victor Thianpiriya of Australia & New Zealand Banking Group Ltd. believe these countries, as well as China, are increasing their gold holdings to minimize exposure to the dollar:
They have been diversifying holdings away from the dollar for years. These countries are still thinking the same way: less exposure to U.S. dollar holdings.”
Last week we reported that China increased its reserves another 1%.
Analysis by ABN-ABRO dovetails with Thianpirya’s view. The company says one reason Russia is purchasing gold is to bolster the ruble:
As Russia is a gold producer, a way to build international reserves is via buying domestically mined gold. This way this gold will not enter the international market. In a way it reduces its dependency on the US dollar for international reserve building.”
