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Russia Gold “Buying Spree” Continues – Buy 22 Tons In November

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Russia Gold “Buying Spree” Continues – Buy 22 Tons In November

- Russia adds another 700,000 ounces (22 tonnes) to gold reserves in November
- Russian ally Kazakhstan increased gold reserves for 38th month to 7 million ounces
- Russia has added 197.1 tonnes in 2015 – Compared with 172 tonnes in all 2014
- November gold buying is Russia’s ninth straight month of increase
- Russia now has sixth largest gold reserves in the world
- Central bank buys all Russian gold production
- Other Russian gold demand imported
- Russia views gold bullion as “100% guarantee from legal and political risks”

RussiaReservesst20151219

Russia continues to add to its gold reserves and added another 700,000 ounces in November or another 22 metric tonnes, and analysts believe this buying will continue and may intensify in the coming months.

Russian ally Kazakhstan increased its gold reserves for a 38th month to 7.03 million ounces in November from 6.96 million ounces a month earlier.

The latest large increase in Russia’s gold reserves – a “buying spree” as reported onReuters Africa has again gone largely unnoticed by most analysts. Indeed, the important monetary and geopolitical ramifications continue to be largely ignored in western media.

Russia’s total gold reserves have now increased to 44.8 million ounces or around 1,392.8 metric tonnes, with a current value of just $48.3 billion. Russia’s total FX reserves are $371.2 billion and their gold allocation remains just 13% of their total reserves.

The share of gold in Russian foreign exchange reserves is much lower than in many other countries such as the U.S., Italy and France. Russian diversification into gold is likely to continue and could intensify if relations with the U.S. and NATO powers further deteriorate.

Russia still have less than a fifth of the gold reserves of the U.S. which are believed to be over 8,400 metric tonnes of gold. However, the U.S. has no foreign exchange reserves and is the largest debtor in the world – indeed it is one of the largest debtors the world has ever seen.

Russia now has the sixth highest gold reserves in the world – behind the U.S., Germany, Italy, France and China.

In 2014, Russia bought more gold in than in any year since the break-up of the Soviet Union. The country acquired over 173 metric tonnes according to World Gold Council figures. Reserve diversification intensified after April — averaging about 20 tonnes per month.

Russia gold buying has intensified in 2015 and now stands at 197 metric tonnes year to date.

Much of the gold bought likely came from Russian gold production which is currently at about 25 metric tonnes per month. In 2014, Russia was the third largest gold miner in the world at 266.2 tonnes, just six tonnes short of Australia in second place and China in first place.

Thus, the Russian central bank is generally consuming all of Russian gold production and sometimes having to import gold. Therefore, all domestic demand for gold and Russia is an increasingly wealthy nation with thousands of millionaires and hundreds of billionaires including mega rich oligarchs.

If any of these oligarchs decide to begin accumulating gold, then the already delicate supply balance in the physical gold market will be impacted resulting in much higher prices. It is worth noting that some of these oligarchs remain close to Putin and the Kremlin and thus this could be a coordinated strategy.

Clearly, Russia puts great strategic importance on its gold reserves. Both President Putin and Prime Minister Medvedev have been photographed on numerous occasions holding gold bars and coins as a display of economic stability and strength and the central bank declared in May 2015 that Russia views gold bullion as “100% guarantee from legal and political risks.”

Prudent investors are following Russia’s lead by diversifying and having an allocation to physical gold coins and bars.

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Wed, 12/23/2015 - 12:46 | 6956542 Latitude25
Latitude25's picture

And low prices are contributing to increased demand at the central bank of latitude25.

Wed, 12/23/2015 - 18:14 | 6958055 Squid-puppets a...
Squid-puppets a-go-go's picture

interesting to know where russia got 700k ounces, given comex has had less than 10 in its registered vaults over the last 2 months....

Wed, 12/23/2015 - 10:10 | 6956047 InnVestuhrr
InnVestuhrr's picture

That explains why gold has lost more than 40% of its peak price and continues to fall.

Gold is a tool used by countries and their central banks trying to compete with the USA, FED and USD, and a HUGE money loser for individuals.

Wed, 12/23/2015 - 14:00 | 6956943 Consuelo
Consuelo's picture

 

 

You might consider tempering such cock-sureness about 'competing' with the $USD/Fed/'USA', especially in light of what just happened to hapless Sec. Kerry in Moscow a few days back.   Be wise not to dismiss either, just how correlated that little snippet in time of U.S. foreign policy crow-eating is with both the Russians and Chinese gold accumulations.   There is a means-to-an-end here.   There is a goal.   And it forebodes a Bitch-slap of historic proportion for the cock-sure $USD-reigns-forever types.

 

 

Wed, 12/23/2015 - 15:51 | 6957452 stacking12321
stacking12321's picture

you're not going to convince invest-duhrrr of anything, he is a troll / shill.

he constantly harps on how gold is "down from the peak" while completely ignoring that gold is 400% of the price it was in 2000. he refuses to accept the proven fact that gold is a long-term store of value, even if in the short term there is some volatility.

the troll talks about gold being a "money loser", when in fact he doesn't even understand what money is.

Wed, 12/23/2015 - 16:47 | 6957702 InnVestuhrr
InnVestuhrr's picture

Gold rose to "400% of the price it was in 2000" ONLY because of the global financial and economic crisis of 2009, and now that the crisis is LONG OVER, gold is returning to the pre-crisis price, in spite of the continuous stream of hype and propaganda from the gold cultists.

IF there is another global financial and economic crisis, then gold will surge in price again,

BUT

so will US Treasuries, and they pay interest.

Wed, 12/23/2015 - 19:38 | 6958355 stacking12321
stacking12321's picture

you're making excuses and rationales, and trying to avoid the facts.

fact: gold is a long term store of value, and has been for thousands of years

fact: gold is 400% of the price it was in 2000, and has vastly outperformed the "treasuries" you speak of.

you're the one bringing up "hype and propoganda", i'm simply stating the facts.

 

Wed, 12/23/2015 - 18:17 | 6958066 Squid-puppets a...
Squid-puppets a-go-go's picture

dude gold being  a loser for the little guy?. - maybe if you paid american dollars for the stuff, but I paid aussie dollars . I've outperformed the S&P, which (being 7 years since the last recession) is at its cyclical zenith, whereas gold's bear is only just digging its cave to hibernate in now

Wed, 12/23/2015 - 09:36 | 6955958 A. Bean-Counter
A. Bean-Counter's picture

Somebody's maths is out.

If the Russian central bank buys all domestic gold production (see headline) and that production equates to 25 M/T per year (paras beow last photo) then they should have booked at least 225 tonnes by end November (without imports). But we are told they have 'only' added 197 tonnes so far in 2015...

Likewise, we are told they produced 266.2 tonnes in 2014, but added only 174 M/T in 2014. So where is the rest going ?

Are they 'doing a PRC' and holding the rest off the official reserves books ...?

Wed, 12/23/2015 - 10:10 | 6956045 shovelhead
shovelhead's picture

Shit gets lost all the time.

Gold is worse than a drunk's car keys.

Wed, 12/23/2015 - 13:48 | 6956888 BorisTheBlade
BorisTheBlade's picture

Yeah, I hear lots of random boating accidents on Moscow river lately.

Wed, 12/23/2015 - 15:35 | 6957391 HowdyDoody
HowdyDoody's picture

They also need gold for the electronics in their shiny new S-400s, Kalibrs, Su-30s and Su-35s.

 

Mon, 12/28/2015 - 14:46 | 6971170 BorisTheBlade
BorisTheBlade's picture

Gold is mined domestically, that's not a concern.

Wed, 12/23/2015 - 09:28 | 6955933 Dragon HAwk
Dragon HAwk's picture

I'm waiting for the day when you HAVE to show some gold when you go thru Customs... to Prove your not a vagrant.

Wed, 12/23/2015 - 13:16 | 6956681 Augustus
Augustus's picture

Chart only shows that Ruble is becomming more worthless.  Puutie has turned the country into an economic disaster.

Wed, 12/23/2015 - 15:43 | 6957413 XXL66
XXL66's picture

The chart shows how gold preserves purchasing power and this is the case for EVERY currency on the world. The difference is ruble gold is probably not manipulated. Btw, what has Obama done with US economy ?

Wed, 12/23/2015 - 13:26 | 6956734 NotApplicable
NotApplicable's picture

So tell me. How come currency devaluation is considered a "good thing" for every country except Russia?

Do they not have to play in "the race to the bottom" like everyone else?

Wed, 12/23/2015 - 17:15 | 6957839 Bring the Gold
Bring the Gold's picture

N/A go easy on Augustus he's a freelance troll for hire and times are tough at the troll household. Can't you find it in your heart to lob him a softball over the plate? Let me demonstrate.

"I think Putin is cool. Is gold good or should I buy treasuries?"

See how those are open ended and give him a "safe space" to shill for the oligarchs?

Wed, 12/23/2015 - 08:08 | 6955812 Singelguy
Singelguy's picture

When was the last time anyone saw the so called 8,400 tonnes that are supposed to be stored at Fort Knox or at the New York Fed and assuming it is still there how many times has it been rehypothecated? Btw, has Germany got its gold back yet or are they still on the 7 year installment plan?

Wed, 12/23/2015 - 10:05 | 6956028 Kagemusho
Kagemusho's picture

The vault at Ft. Knox is probably empty, courtesy of being shipped to Beijing and Moskow...and maybe a few Gulf oil states as well. If there's anything at Ft. Knox, it's probably a hologram you can see from the vault door...with a little scrap of paper on the floor saying "I.O.U America X number tons of Au, Nothing but love for ya, signed The Banksters".

Wed, 12/23/2015 - 07:45 | 6955784 gonetogalt
gonetogalt's picture

1st avatar change in 3+ yrs, (I like it).

Now, about that gold production....

and a very Merry Christmas to all my ZH buds!!!

Wed, 12/23/2015 - 07:38 | 6955779 RonArgent
RonArgent's picture

Negronomics, High demand = Lower Price

Wed, 12/23/2015 - 13:11 | 6956648 Augustus
Augustus's picture

Puutie looking at the gold bar wondering how he can stuff it into his pants, remembering how he stole that gold ring.

Wed, 12/23/2015 - 15:33 | 6957373 HowdyDoody
HowdyDoody's picture

Russia is schlong gold? Barbarians!

 

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