Russia added 55 tonnes of gold to its reserves in the third quarter of this year, the World Gold Council (WGC) said in its latest Gold Demand Trends report, to firm up the rouble during an economic war with Western states that has battered the Russian currency.
Russian central bank gold reserves of 1,149.80 tonnes, according to the WGC’s November statistics, account for around 10 percent of its assets.
The news comes amid a sharp decline in the rouble – down more than 25 percent against the dollar this year, hitting an all-time low at 48.60 – after western countries imposed economic sanctions on Russia following its support of separatists in Ukraine.
The slump in oil prices to around $80 per barrel from nearer $110 at the start of the year has weighed in particular. Western sanctions have deliberately targeted the oil and gas industries, which account for upwards of 40 percent of the Russian government’s income.
Kazakhstan added 28 tonnes and Azerbaijan seven tonnes to their reserves in the third quarter, the WGC also said.
Central banks have been looking to shore up their currencies with physical assets that hold high value, buying 93 tonnes of gold in the last quarter, down nine percent year-on-year but the 15th consecutive quarter where they remained net buyers.
Total supply for the quarter fell seven percent to 1,048 tonnes, with mine supply up one percent but the gold recycling rate falling to its lowest since 2007.
Third-quarter gold demand fell two percent year-on-year to 929 tonnes. Overall gold demand remained subdued but the decline was less severe than the second quarter’s 16-percent drop.
In value terms, third-quarter gold demand of $2.3 billion was down six percent on a year ago.
Spot gold is near four-year lows at $1,160.00/1,160.80 per ounce, down from a peak of $1,388.20 in March.
