According to strategists cited by the Japanese business daily Nikkei Asia, central banks around the world have increased their gold purchases since Russia’s overseas assets were frozen under sanctions this year.
The US and its allies are said to have frozen $300 billion in Russian foreign reserves, as well as billions more held by individuals and businesses. The Kremlin has called the seizures “theft” on numerous occasions.
According to data published in the World Gold Council’s November report, gold purchases by regulators more than quadrupled in the July-September period, totaling 399.3 tons.
The figure represents a significant increase from 186 tons in the previous quarter and 87.7 tons in the first quarter of this year. Meanwhile, the total for the year has surpassed any full year since 1967.
Emin Yurumazu, a Turkish economist based in Japan, told the media that “anti-Western countries are eager to accumulate gold holdings on hand,” following the freezing of Russia’s overseas assets as part of sanctions.
Turkey’s, Uzbekistan’s, and India’s central banks previously stated that they had purchased 31.2 tons, 26.1 tons, and 17.5 tons, respectively. It is currently unknown which countries purchased the remaining 300 tons.
Some unidentified purchases are to be expected, but one of “this magnitude,” according to Koichiro Kamei, a financial and precious-metals analyst cited by the agency.
“China most likely purchased a significant amount of gold from Russia,” market analyst and former World Gold Council Japan director Itsuo Toshima said. He explained that the People’s Bank of China most likely purchased a portion of the Central Bank of Russia’s over 2,000 tons of gold holdings.
The analyst noted that this is typical of the Chinese monetary regulator, which did not disclose any gold purchases from 2009 to 2015 before reporting a 600-tonne increase in reserves. Since 2019, the People’s Bank of China has not issued any new reports on gold purchases.
The gold buying frenzy is part of a renewed effort by central banks to protect their assets by reducing their reliance on the US dollar. In the current de-dollarization trend, China has been a dominant force. According to US Treasury Department data, the country sold $121.2 billion in US bonds between March and October.
