Why are Russia and China buying so much gold?
By Duncan Richardson, News Editor
31 Mar 2016
The Russian central bank is aggressively adding to their gold hoard and like China edging closer to backing their currencies with gold. In 2015, Russia increased their gold reserves by 208.4 tonnes and in February alone purchased a further 356,000 ounces. China followed Russia lead by adding a further 320,000 ounces in February.
Lord Rothschild, believes Russia clearly wants to increase their gold holding at the expense of the U.S dollar. Russia has been liquidating its treasury holdings and reinvesting the proceeds to boost their bullion holdings and reduce their foreign debt.
China also regards gold as a strategic assets and continue to add gold to their foreign reserves. In the last four months the emerging giant purchased a further 101 tons of gold. Many gold commentators now believe China’s central bank is grossly underestimating their gold reserves so as not to cause alarm bells within the global economy.
Russia’s closest Eurasian allies Belarus and Kazakhstan are also frantically purchasing the yellow metal. It is now clear countries along China’s new Silk Road are viewing gold as a basis for the Eurasian economy.