Money and Metals

The Resource Investor reports on a developement in Russia. "Russia's Head of External Reserves Management, Maria Guegina, said gold reserves as a proportion of all reserves may be doubled. Noting that Russia presently has 5% of its national reserve portfolio invested in gold, Guegina said, '10% of gold in reserves would be appropriate.'"

"Russia presently has 500 tonnes (17.64moz) of gold in reserves which it segregates as monetary gold, allocated gold and term deposits. The envisaged doubling of Russia’s gold reserves as a proportion of all reserves at present values would consume all the country’s annual gold output for around three years."

"The actual tonnage to be added continues to grow as Russia aggressively builds its overall reserves thanks to a windfall profits from oil and gas, a good deal of which is now flowing directly to the state. At recent oil prices Russia was raking in $500 million a day from its oil exports."

"Guegina’s indication of Russian gold buying chimes with comments yesterday by Professor Kenneth Rogoff. He told delegates that he expects gold sales to be reversed in the medium term as central banks seek to offset rising risks and because of the need for diversification away from the American dollar."