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Russia Buys 0.5 Million Ounces and Bank of Korea “Needs To Buy More” Gold

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The Russian central bank has again increased its gold reserves by 500,000 ounces.

Bank Rossii announced that it had increased gold stocks in its international reserves by 0.5 million troy ounces to 29.3 million troy ounces in May from the end of April.

Russia's gold and foreign exchange reserves declined to $512.2 billion in the week ending June 15 from $512.4 billion a week earlier. Russia’s reserves remain very sizeable and have increased in 2012 as they were at $498.6 billion at year end 2011.     


IMF Russia Gold in Million Fine Troy Ounces (Monthly Chart)

The reserves include monetary gold, special drawing rights, reserve position at the IMF and foreign exchange.

On May 25th, the deputy chairman of Russia's central bank, Sergey Shvetsov, said that the Bank of Russia plans to keep buying gold on the domestic market in order to diversify their foreign exchange reserves.  

"Last year we bought about 100 tonnes. This year it will be less but still a considerable figure" Shvetsov told Reuters.


IMF Russia Gold in Million Fine Troy Ounces (Monthly Data)

Today, Alexei Kudrin, Russia's former finance minister said that a full-blown economic and financial crisis in the euro zone is inevitable and will develop within a year.

"Greece will not be able to fulfill its obligations (towards lenders)," Mr. Kudrin, said at a conference.

"A serious financial and economic crisis will hit Europe within a year... with Spain being its next victim, and then possibly Italy," he added.

"The time (for avoiding it) has already past."

Russia may be planning to give the ruble some form of gold backing in order to protect the ruble from devaluations and protect Russia from an international monetary crisis.

The Bank of Korea  has said that its current gold holdings are too small and that the BOK may buy more gold this year in order to diversify its foreign exchange portfolio which is exposed to the dollar.

Eugene Kim, chief investment officer at the central bank's foreign-exchange reserve management group, said its gold holdings are "too small" given the size of its forex reserves, which stood at a record-high of $310.87 billion at the end of May, and that the BOK might buy more bullion this year.

According to the BOK's latest data at end-2011, U.S. dollar-denominated assets accounted for 60.5% of South Korea's total forex reserves, while other currencies such as the euro, yen and pound made up the remaining 39.5%.

The BOK said that they will not be selling their euro assets but they will be diversifying into yuan denominated assets – Chinese debt and equities. 


IMF South Korea Gold in Million Fine Troy Ounces (Monthly Chart)

He said the BOK isn't currently investing in the Brics nations except for China, but it is closely looking for opportunities in other Asian and Latin American countries--such as Indonesia, Malaysia, Thailand, India, Brazil and Mexico--from a long-term perspective.

Mr. Kim said the central bank needs to boost its gold holdings even after two purchases last year that took the amount to 54.4 metric tons, or about 1% of the total reserves.

"Unlike other financial instruments, gold doesn't produce interest. But given its symbolic presence and usefulness as a safe haven in times of crisis, the BOK needs to buy more. We may do so this year," he said.

The Bank of Korea’s gold reserves remain tiny as a percentage of their  large foreign exchange holdings. They are also very small when compared to the gold holdings of western central banks many of whom, such as the Federal Reserve, have over 50% of their reserves in gold bullion.


Cross Currency Table – (Bloomberg)

OTHER NEWS
(Bloomberg) -- Silver imports by China were 226.6 metric tons in May, according to data released by the customs agency today.

That compares with 236.9 tons in April. Platinum imports were 9.88 tons in May, compared with 6.9 tons a month earlier, data showed.  Palladium imports were 1.85 tons, data showed.

(Bloomberg) -- IShares Silver Trust Holdings Unchanged at 9,821 Metric Tons
Silver holdings in the IShares Silver Trust, the biggest exchange-traded fund backed by silver, were unchanged at 9,821.45 metric tons as of June 20, according to figures on the company’s website.

================================================================================

                   June 20    June 19    June 18    June 15    June 14   June 13

                      2012       2012       2012       2012       2012      2012

================================================================================

Million Ounces     315.767    315.767    315.233    313.293    311.741   311.741

 Daily change            0    533,507  1,940,108  1,552,109          0         0

--------------------------------------------------------------------------------

Metric tons       9,821.45   9,821.45   9,804.85   9,744.51   9,696.23  9,696.23

 Daily change         0.00      16.60      60.34      48.28       0.00      0.00

================================================================================
NOTE: Ounces are troy ounces. SOURCE: iShares Silver Trust 

(Bloomberg) – Barclays Favors Palladium Across Precious Metals in Coming Year
Barclays Plc said it favors palladium across precious metals in the next 12 months.

Platinum-group metal prices “offer attractive buying opportunities,” the bank said in a report e-mailed today. Palladium will average $700 an ounce this year and platinum will average $1,622 an ounce, it said.

(Bloomberg) -- David Gornall Re-Elected Chairman of London Bullion Association
David Gornall, global head of metals trading at Natixis SA, was re-elected chairman of the London Bullion Market Association.

Peter Drabwell of HSBC Bank USA NA and Kevin Roberts of JPMorgan Chase Bank were elected to replace Jeremy Charles of HSBC Bank and Clive Turner of JPMorgan Chase Bank on the management committee, according to a statement yesterday from the LBMA. Steven Lowe of Bank of Nova Scotia-ScotiaMocatta was re- elected LBMA vice chairman, it said.

Grant Angwin of Johnson Matthey Inc., Simon Churchill of Brinks Ltd. and Jeremy East of Standard Chartered Bank were re- elected to the management committee, it said.

(Bloomberg) -- The London Bullion Market Association added Nadir Metal Rafineri San. Ve Tic. A.S. of Turkey to its so-called good delivery list for silver.

The company will be added to the list today and was put on the gold good delivery list in December, the LBMA said in a statement e-mailed today.

 

 


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Fri, 06/22/2012 - 01:21 | Link to Comment ich1baN
ich1baN's picture

Man I love you guys in a non-homerotic way.... you made me laugh so hard with your comments. Anyways, gold and silver were smacked today but I expect EuroTrash to bring it back up as the Greeks will eventually leave the Euro and EU and this will produce a huge pscyhological scare in the Italians and Spanish (maybe French as well) from the conversion currency risk and you will see huge pools of money from retirees, pensioners, fund managers etc.... move euros into us treasuries, equities, and even gold and silver in my opinion. As ugly as the first 2 sound, it is just a reality of the state of mind of many people b/c they have not crossed the blood-brain barrier and yet recognize gold and silver as money.... however there are many europeans from the old world pre 1950s that believe in gold and silver and you bet your behind they will be putting their euros into gold and silver. This is an interesting roller coaster and Bernanke will print when oil hits 60-65$ a barrel.... this was one of the many reasons he didn't go full Ctrl-F9 mode yesterday b/c he knew it would spike oil above 150$ a barrel and cause the middle class to be hurt, thereby probably ruining OBummer's reelection chances.... Anyways, I still see gold going to 2000 by year end and silver eclipsing the 50$ psychological stress test.

Thu, 06/21/2012 - 14:07 | Link to Comment Bansters-in-my-...
Bansters-in-my- feces's picture

The USA Gov,allows gold prices to be manipulated through the BIS and the ESF,which is a fund that the USTreasury has sole power over with no oversight and designed to bitch slap what ever they want.Gold is their main target.
Fuck you's...!!!

Thu, 06/21/2012 - 14:05 | Link to Comment No Euros please...
No Euros please we're British's picture

Gold smacked down again, the boys in the far east must wetting themselves. If Obama can't see oil being sold for gold anytime soon then he really is a numbnut.

Thu, 06/21/2012 - 13:26 | Link to Comment Conax
Conax's picture

All these countries buying gold and the price still drops. It's as if the gold is a problem and is being deported with extreme prejudice from our economy. Don't let the door knob hit you in the hard assets!

 

We (and our gold) are being sold down the river. Where's my corn pone and molasses?

Thu, 06/21/2012 - 13:15 | Link to Comment CustomersMan
CustomersMan's picture

 

 

The return on the US Dollar Treasuries, netted out after inflation, produces negative interest. So there.

Thu, 06/21/2012 - 13:10 | Link to Comment Vint Slugs
Vint Slugs's picture

How about an article that's really informative; such as who's selling instead of all of these bull puff pieces about buyers?

Thu, 06/21/2012 - 14:08 | Link to Comment No Euros please...
No Euros please we're British's picture

Because only the US has enough real gold to manipulate the market. Most of it is paper manipulation with gold futures. You try to buy real gold and you'll find that the price to YOU is the same now at $1560/oz as it as a few months back when it was $1660/oz. This is REAL supply and demand not paper shit.

Thu, 06/21/2012 - 13:02 | Link to Comment Mordan I
Mordan I's picture

Until no one will sell at a price.

 

 

Thu, 06/21/2012 - 13:02 | Link to Comment dlmaniac
dlmaniac's picture

Russians must love days like today. "Thank you, Bernanke & Morgue but no thanks, f***ers!"

Thu, 06/21/2012 - 12:42 | Link to Comment falak pema
falak pema's picture

this is coming too early, why don't they wait for the dip to 1100 after no QE3 becomes likely and ECB  changes its rates?

Thu, 06/21/2012 - 12:48 | Link to Comment jimmyjames
jimmyjames's picture

this is coming too early, why don't they wait for the dip to 1100 after no QE3 becomes likely and ECB  changes its rates?

*********

I'll pencil you in as short gold 1570-

 

Thu, 06/21/2012 - 12:37 | Link to Comment dick cheneys ghost
dick cheneys ghost's picture

Rigged Gold market a secret payoff to China?

 

 

 

http://etfdailynews.com/2012/06/19/rigged-gold-market-a-secret-payoff-to...

Thu, 06/21/2012 - 12:34 | Link to Comment Shadowsil
Shadowsil's picture

I am fairly sure, Russia and its bankers Read Zerohedge. As does China. Seems like they are buying it all the time lately.

Thu, 06/21/2012 - 12:32 | Link to Comment covert
covert's picture

the russian are getting smart, too bad Americans aren't so ambitious.

http://covert.ias3.com/expose/

 

Thu, 06/21/2012 - 12:30 | Link to Comment tony bonn
tony bonn's picture

"Unlike other financial instruments, gold doesn't produce interest..."

bullshit

Thu, 06/21/2012 - 14:17 | Link to Comment Bansters-in-my-...
Bansters-in-my- feces's picture

Ugh....?

Gold a "financial instrument"

Not so says the Banker....

Yours is like "corn" if you are not a central terrorist,oops, I mean banker.

The USA should change the saying "our dollar is "as good as gold" to

"Our dollar is as good as Corn"

GMO Corn at that.....

That means Genetically modified into Tungsten.

Thu, 06/21/2012 - 13:18 | Link to Comment FieldingMellish
FieldingMellish's picture

and unlike other financial instruments, there is no counterparty risk either.

Thu, 06/21/2012 - 13:35 | Link to Comment ebworthen
ebworthen's picture

Certainly can't be CORZINED if you hold physical, or taxed or fee'd or re-hypothecated or used to create zombie derivatives.

I see the purchase of Gold by Russia, Korea, and the like as their only alternative to fight the MBS, CDS, derivative financial engineering legerdemain of the vampire squid banks.

Thu, 06/21/2012 - 14:11 | Link to Comment Tinky
Tinky's picture

can't be taxed? The IRS (outrageously) considers gold to be a collectible, and taxes at 28% (long-term).

What am I missing?

Thu, 06/21/2012 - 16:20 | Link to Comment ebworthen
ebworthen's picture

Only if you report it.  Not like a mutual fund or stock where everything is tracked and reported.  Gold can be used as exchange for services, trade, or sold for cash.  Fuck the IRS.

They probably have a tax on intercourse per-thrust, but that doesn't mean I'm going to tell them who, what, where, when, or how many.

Thu, 06/21/2012 - 12:28 | Link to Comment dogbreath
dogbreath's picture

looks like they won't have to go far to find a bargain

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