Russia’s central bank announced yesterday that it will suspend domestic #gold purchases on 1 April, with further decisions on gold to be made depending on market circumstances. 
The Central Bank of the Russian Federation (CBR) had been a consistent gold buyer since 2006, reaching 2,279 tonnes of gold holdings as of March 2020 which accounted for 20.6% of total reserves. CBR’s announcement followed several signals that it was scaling back its gold buying.
The pace of buying had slowed from 274 tonnes in 2018 to 158 tonnes in 2019, and a discount to price at which CBR buys domestic gold was implemented in May 2019 to encourage producers to find other buyers.
The decision to suspend gold buying comes at a time when Russia is drawing down on its official reserves to defend the ruble against the impact of both falling oil prices and the coronavirus. In this context, Russia’s decision reflects its macroeconomic and geopolitical needs.
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