Gold: Why Russia is beefing up emergency reserves
In the British newspaper the Daily Express published an article with the forecast Analytics a small British brokerage company that is probably coming a new world economic crisis. Possible cause of crisis, a British expert called the activity of Russian Federation on the world market of investment gold. His original estimate for the 1st quarter of 2019 Russia increased purchases of investment gold at 145.5 tons, 22% more than the purchase of gold for the whole of 2018. However, after some time the newspaper publish a refutation of some of the figures contained in the article, in particular, it said that at 145.5 tons of gold purchases increased not Russia, but taken together, Central banks around the world.
With the British dimension, you can argue, but much earlier, the world gold Council (WGC) wrote in one review, in 2015-2018, the Bank of Russia purchased gold in its reserves more than the Central banks of all developed countries of the West together. Russia, according to WGC estimates, at the beginning of 2019, ranked fifth in the world in terms of investment stocks of gold amounting to 2 036,3 so the First four places in the world reserves of gold are held by the USA, Germany, Italy and France, and China is only the sixth, but the ten largest countries by gold reserves recently into Turkey.
British analyst believes that the real reason for the increasing Russian purchases of gold is the expectations of the global economic crisis and the collapse of the dollar. But the head of the Federal reserve system Jerome Powell estimated the probability of a new world crisis as a short even though unreasonably increased the debt load of American business, not to mention public debt.
Experts worldwide are trying to find a universal tool to accurately predict the onset of the global economic crises, for example, the inversion of the yield curve of US government bonds or other factor. However, the real causes of the rise in the purchase of gold of our country lie in the area of sanctions and geopolitics. In addition, Russian gold reserves can rise and fall during crises and economic recovery, depending on the dynamics of oil prices and the stability of the ruble.
But the main reason for the increase in purchase of gold by Russia, security issues of foreign exchange reserves of the Central Bank of the Russian Federation. The increase in purchases of gold by Russia in the last three years is primarily due to the anti-Russian Western sanctions and the possible threat of a Russian ban on dollar transactions, although this threat is very small. In addition, given that the external and internal policy of the United States under President trump was not too predictable, there are risks for the dollar, therefore, to keep international reserves in that currency is not as secure as it was in XX century.
In early January, 2019 Troy ounce of gold was worth $1283.68 for 4.5 months its price fell slightly, to $1274,31 per Troy ounce. According to “Alpari gold” by early summer, quotes of the precious metal may be reduced to the range of $1260 – $1270 in the case of a new wave of strengthening of the US dollar.
Deputy Director at “Information-analytical center,