The flight from the US Dollar continues. Russia added 31.3 tonnes of gold to their reserves in February, probably bought with US Dollar-denominated assets like Treasuries and, well, the Dollar itself. How much gold does Russia have now, you might ask? There are conflicting numbers on that, so we won’t venture a precise number right now, but it’s doubtless north of 2200 tonnes.
Russia has been very public about reducing their US Dollar-based reserves, especially after US sentiment turned negative against Russian companies, businessmen, and the country itself during the last US Presidential election. Your friendly Gold Enthusiast believes that countries should be cautious about becoming too dependent on one or another country’s currency, as that makes the country susceptible to currency value fluctuations created by political shifts, such as is happening in Venezuela. And, to an extent, what is happening now in the US with the Trump presidency.
We doubt that the results of the Mueller investigation will reverse the negative sentiment toward Russia, now that the left is in control of the US media narrative. So Russia is probably wise to shift toward a more diversified, independent basket of assets that is heavy in precious metals – which don’t care about politics. You can read more on Russia’s latest buys in today’s featured article.
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