Advertise | Bookmark | Contact Us | E-Mail List |  | Update Page | UraniumSeek.com 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

Do Not Feed The Bears - Until 2018
By: Avi Gilburt

Exclusive Interview (Part II): Alex Green on the Biggest Threat We Face
By: Frank Holmes

Gold Market Morning: August-23-2017: Gold and silver prices still marking time!
By: Julian D.W. Phillips

Global Financial Crisis 10 Years On: Gold rises 100% from $650 to $1,300
By: Jan Skoyles

Gold Seeker Closing Report: Gold Chops Lower While Stocks Rebound
By: Chris Mullen

Camino Intersects 96.5 Meters Grading 0.93% Copper At Adriana Zone And Expands Katty Oxide Zone
By: Camino Minerals Corporation

Ira Epstein's Metals Video 8 22 2017
By: Ira Epstein

Gold Stocks: Good Times Are Near
By: Stewart Thomson

GoldSeek Radio Nugget: Bob Hoye and Chris Waltzek
By: GoldSeek.com Radio

How Planned Fed Rate Increases Impact The National Debt And Deficits
By: Daniel R. Amerman, CFA

 
Search

GoldSeek Web

 
Russia Buys 900,000 Ounces Of Gold Worth $1.17 Billion In April


 -- Published: Wednesday, 21 May 2014 | Print  | Disqus 

Yesterday’s AM fix was USD 1,291.50, EUR 943.46 and GBP 767.56 per ounce.

Gold climbed $1.10 or 0.08% yesterday to $1,294.70/oz. Silver rose $0.03 or 0.15% to $19.42/oz.

Gold is marginally lower today at $1,293.50/oz and remains in lock down in an unusually tight range between $1,287/oz and $1,306/oz this week. Gold in Singapore, which often sets the price trend in Asia, traded at $1,292.23/oz prior to a bounce to just over $1,295/oz.


President Putin holds a London Gold Delivery Bar

Gold has been in a very narrow range between $1,283/oz and $1,310/oz for a month now. There are a lot of things going on underneath the surface of the calm gold market this month. That superficial calm is likely to give way in the coming days as we appear on the verge of a sharp move to the upside or downside once gold breaks out of the recent range.

A break below $1,283/oz is possible and this could see gold quickly fall to test longer term support at $1,200/oz. This is likely if the technical traders and computer manipulations continue to dominate. However, should physical demand pick up on rising geopolitical tensions and the return of Indian demand with the easing of import duties, gold should quickly challenge resistance at $1,385/oz and $1,418/oz.

Russia Buys 900,000 Ounces Of Gold Worth $1.17 Billion In April
The Russian central bank has again increased its gold reserves by another 900,000 ounces worth $1.17 billion in April.

Russia's gold reserves rose to 34.4 million troy ounces in April, from 33.5 million troy ounces in March, the Russian central bank announced on its website yesterday. The value of its gold holdings rose to $44.30 billion as of May 1, compared with $43.36 billion a month earlier, it added.

The following is a summary from Bloomberg of the April data template on international reserves and foreign currency liquidity from the Central Bank of Russia in Moscow:

Russia's gold & foreign exchange reserves remained virtually unchanged at USD 471.1billion in the week ending May 9. Russia’s reserves have fallen since the crisis began but remain very sizeable. The reserves include monetary gold, special drawing rights, reserve position at the IMF and foreign exchange.

The 900,000 ounce purchase is a lot of physical gold in ounce or tonnage terms but as a percentage of Russian foreign exchange reserves it is a very small 0.24%.

Gold as a percentage of the overall Russian reserves is now nearly 10%. This remains well below the average gold holding as a percentage of foreign exchange reserves of major central banks such as the Bundesbank, Bank of France and the Federal Reserve which is over 65%.

The Russian central bank has been gradually increasing the Russian reserves since 2006 (see chart above). On average they have been accumulating 0.5 million troy ounces every month. Therefore, the near 1 million ounce purchase in April is a definite increase in demand.

This was to be expected given the very pronounced geopolitical tension with the U.S. and west over Ukraine. Indeed the TIC data shows that Russia has been aggressively divesting themselves of U.S. Treasuries.

Russian holdings of U.S. Treasuries fell very sharp, by nearly $50 billion, between October and March 2014 or nearly a third of Russia’s total holdings. Over half of the plunge came in March, when $26 billion was liquidated as western sanctions were imposed. TIC Data for April won’t be available until June and will make for very interesting reading.

Especially given the mysterious huge U.S. Treasury buying that is being done by little Belgium. This has analysts scratching their heads and has aroused suspicions that the Fed and or the ECB may be behind the huge Belgian purchases.


Russian Gold Reserves in Million Fine Troy Ounces - 1995-2014 - Monthly Chart (Bloomberg)

Russia has already made their intentions regarding gold very clear. Numerous high ranking officials have affirmed how they view gold as an important monetary asset and Putin himself has had many publicised photos in which he very enthusiastically holds large gold bars.

On May 25th 2012, the deputy chairman of Russia's central bank, Sergey Shvetsov, said that the Bank of Russia plans to keep buying gold in order to diversify their foreign exchange reserves.

"Last year we bought about 100 tonnes. This year it will be less but still a considerable figure," Shvetsov told Reuters at the time.

The World Gold Council reported yesterday that central bank purchases were 70% above their 5-year quarterly average, led by Iraq and Russia. The Eurozone actually became a net buyer thanks to Latvia joining the single currency union, adding its gold to the Eurozone reserves as part of the Euro treaty.

Russia may be planning to give the ruble some form of gold backing in order to protect the ruble from devaluations and protect Russia from an international monetary crisis and the soon to return currency wars.

Russian central bank demand and indeed global central banks demand is set to continue as macroeconomic, monetary and geopolitical uncertainty is unlikely to abate any time soon. Indeed, it may escalate substantially in the coming months as we move into the next phase of the global debt crisis.

Follow GoldCore and GoldCore's Head of Research Mark O'Byrne on Twitter.


| Digg This Article
 -- Published: Wednesday, 21 May 2014 | E-Mail  | Print  | Source: GoldSeek.com

comments powered by Disqus



 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2017



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer

The views contained here may not represent the views of GoldSeek.com, its affiliates or advertisers. GoldSeek.com makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, is strictly prohibited. In no event shall GoldSeek.com or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.