Russia - the Biggest Buyer of Gold?
February 13, 2013 [...]
China and Russia are already considering the dollar "a threat" to their national economies. As a precautionary measure, they have been stockpiling gold ingots.
India has been buying gold as well. In fact, many sources considered India a bigger gold buyer than China.
Although, the news are always highlighting China and the precious metals experts are also focusing more on the communist country's gold purchases.
There are plenty of speculations whether China or India is the biggest buyer of gold. Indian figures are better known to the public, while the Chinese communist regime is withholding important data regarding the quantities bought.
But: Russia is often omitted, despite it having an immense hunger for gold, not to mention their substantial reserves of gold.
How much gold is the World's biggest country buying?
According to a recently published Bloomberg article, Russia might as well be the biggest gold buyer in the World.
The measures undertaken by Vladimir Putin have made Russia the biggest oil producer in the World.
During the past decade, Russia bought 570 tonnes of gold, which (according to the mentioned article) is 25 % more than China's purchases during the same period.
Bloomberg is telling us that the 570 tonnes of gold that Russia added to their portfolio outweighs even the Statue of Liberty in New York!
An interesting fact in this article is that in 1998, it took 28 barrels of crude oil to purchase a single ounce of gold, but the ration had tumbled to 11.5 barrels by the time Putin came to power for the first time (this happened in 1999). Then, in 2005 it touched 6.5.
Obviously - Russia being the biggest producer of oil, it is worth for them to purchase gold. The ratio between oil and gold has gone down and in fact, gold can be considered "cheap" in Russia.
Buying gold with US dollars is not the same things as producing oil and selling and then buying gold with the amount earned.
It's the oil-gold price ratio that helps Russia accumulate immense quantities of gold.
The quantitative easing measures of the USA, the eurozone and Japan are driving up the demand for gold.
Among the biggest buyers are the BRIC nations, but smaller economies have also started entering the race.
According to the World Gold Council February 9th report (metioned in the Bloomberg article), Russia is "only" the 8th gold holder in the World with its 958 tonnes.
The USA is still number one with 8,134 tonnes, Germany second with 3,391 tonnes and the 3rd being the IMF with 2,814 tonnes.
According to older statistics, in 2010: China was 6th with 1,054.1 tonnes, India was 11th with 557.7 tonnes.
Approximately 2/3 of Russia's gold reserves are held inside a building on Ulitsa Pravdy in central Moscow.
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