Close X Cookies are necessary for the proper functioning of 24hGold.com. By continuing your navigation on our website, you are accepting the use of cookies.
To learn more about cookies ...
EnglishFrench

Russian central bank to keep buying gold, moving away from risky paper assets

IMG Auteur
Published : January 25th, 2013
810 words - Reading time : 2 - 3 minutes
( 1 vote, 5/5 )
Print article
  Article Comments Comment this article Rating All Articles  
0
Send
0
comment
Our Newsletter...

By Darya Korsunskaya
Reuters
Thursday, January 24, 2013

http://www.reuters.com/article/2013/01/24/russia-cbank-idUSL6N0AT41J2013...

DAVOS, Switzerland -- The Russian central bank will continue to buy gold as it seeks to diversify its foreign reserves away from paper assets it views as risky, First Deputy Chairman Alexei Ulyukayev said today.

The Bank of Russia has built up the world's fourth-largest foreign reserves, worth $530 billion, by buying oil export dollars to keep the rouble competitive. The hoard includes two rainy-day budget funds that guard against fiscal shocks.

The bank has also been a bullion buyer and the share of gold in its reserves is approaching a medium-term target of 10 percent, raising questions over whether it would keep buying gold.


Ulyukayev, speaking during the World Economic Forum, said the central bank would continue to buy gold, but gave no indication on whether there would be any change in the share of its reserves it allocates to the precious metal.

"We are buying metal and will continue to pursue this course," Ulyukayev told reporters in Davos. "This is a course of asset diversification in a situation when investing in securities or deposits remains risky."

Russia's central bank is undertaking a shift from a managed float of the rouble to inflation targeting, which is leading it to scale back its accumulation of forex via market interventions as it fine-tunes interest rate policy.

But the government wants to bolster its ability to withstand economic shocks, and will transfer $30 billion in surplus revenues from last year to its fiscal Reserve Fund, meaning that the central bank's reserves will grow.

Ulyukayev oversees the Bank of Russia's asset management and is viewed as a contender to take the helm when Chairman Sergei Ignatyev retires in June. He dodged a question when asked whether President Vladimir Putin had chosen him for the job.

"It's good that he's made up his mind -- better an end to the horror than horror without end," joked Ulyukayev, a liberal economist who has published his own book of poetry.

The Kremlin dismissed reports that Putin had already made up his mind. "The process continues, but not as actively as some are writing -- there's still plenty of time," Dmitry Peskov told Reuters. A candidate should be chosen in March.

Ulyukayev, 56, has weighed into an intensifying debate over the "currency wars" that have broken out as advanced economies pursuing aggressive monetary stimulus in a bid to grow their way out of a debt trap.

He recently accused Japan of "protectionist monetary policy" and, detailing the current composition of the central bank's foreign exchange reserves, he made no mention of the yen.

According to a breakdown given a year ago, the central bank held 1.6 percent of its forex reserves in yen. It was not immediately clear whether or when that position had been sold.

Russian bankers in Davos said, meanwhile, that it would make sense for the central bank to expand its allocation to gold.

Another source familiar with the central bank's thinking said, however, that there were no plans to change the 10 percent share. Russia's central bank bought 80 tonnes of gold last year, and it plans to buy a similar amount in 2013.

At the end of last year, the central bank held nearly 950 tonnes of gold, worth some $51 billion, its figures show.

It owned 400 tonnes of gold at end of 2006 and the price of the yellow metal has since rallied by $1,000 as the regulator bought up around half of Russia's gold mining output.

Giving a breakdown of the currency portion of Russia's foreign reserves, Ulyukayev said the U.S. dollar accounted for 46 percent and the euro 40.5 percent.

Sterling has a 9 percent share, the Canadian dollar 3 percent, and the Australian dollar, added to Russia's reserves last year, at 2 percent.

Separately, he said that inflation could exceed 7 percent in February but should start to ease from March onward. Consumer inflation reached 6.6 percent in 2012.

He saw no grounds for further monetary stimulus but left open the direction of the central bank's next interest-rate move. "It could be one way or the other," he told reporters.

* * *

Join GATA here:

California Resource Investment Conference
Saturday-Sunday, February 23-24, 2013
Hyatt Regency Indian Wells Resort and Spa
Palm Desert, California
http://www.cambridgehouse.com/event/california-resource-investment-confe...

* * *

Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006:

http://www.goldrush21.com/order.html

Or by purchasing a colorful GATA T-shirt:

http://gata.org/tshirts

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

http://gata.org/node/wallstreetjournal

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16



Companies Mentionned : Bullion |
Data and Statistics for these countries : Japan | Russia | Switzerland | All
Gold and Silver Prices for these countries : Japan | Russia | Switzerland | All
<< Previous article
Rate : Average :5 (1 vote)
>> Next article
Chris Powell is the secretary of the Gold Anti-Trust Action Committee (GATA) which has been organized to advocate and undertake litigation against illegal collusion to control the price and supply of gold and related financial securities.
WebsiteSubscribe to his services
Latest comment posted for this article
Be the first to comment
Add your comment
Top articles
Latest Comments
The Crash of the Bank of the Uni...
01 Augsam_site
AN ASTOUNDING EXPOSURE What no one recognizes to this day is that the Fed stole America's gold and shipped it to Germany causing b...
Iran Agreement Boosts Peace, Def...
29 JulArtboard
A US Naval vessel shot down an Iranian Passenger Jet with 300 passengers, over the Persian Gulf on the 3rd July 1988, they mistook it for a Fighter...
Will Uncle Sam Confiscate Gold A...
31 Julovertheedge
"... , generally larger amounts would be safer stored in the safest vaults in the world and in the safest jurisdictions in the world." An...
Gold market liquidity and manipu...
29 JulPD
Bron, I was wondering if the planned Allocated Bullion Exchange (ABX) would have any impact on the liquidity of the Gold market. Would it not at le...
Is the gold price manipulated?
29 Juldanzas1231
This article is a joke. Please stop writing baseless garbage. There is enough real evidence of the things you're still calling conspiracy. GATA hav...
Is the gold price manipulated?
28 Julkeith952
... if one takes the dumping of an usually high tonnage of gold at an illiquid time in the gold market aka the Monday one week ago - then such 'b...
Gold Reserves and GDP: China is ...
30 JulWilliam Tan
Shakespeare was right; "The world is a stage." Unfortunately we have all the bad actors acting at once.
Iran Agreement Boosts Peace, Def...
28 Julsonora69
You have a point. The 2003 Iraq invasion is mostly now considered an ill-advised and unjustified destabilization, with regional & political consequ...
Most commented articlesFavoritesMore...
World PM Newsflow
ALL
GOLD
SILVER
PGM & DIAMONDS
OIL & GAS
OTHER METALS
Mining Company News
Vena Res.(Ag-Au-Cu)VEM.TO
Provides Update With Regards to the Arbitration Concerning the Azulcocha West Project and Enf
CA$ 0.04-35.71%Trend Power :
Exploration and drilling
Rockwell(Cu-Gems-Ni)RDI.TO
Announces Delay in Annual Meeting and Meeting Date
CA$ 0.20-2.44%Trend Power :
Corporate news
Eldorado Gold(Au-Fe)ELD.TO
Reports 2015 Second Quarter Financial and Operational Results
CA$ 4.50+11.39%Trend Power :
Financials
Endeavour Financial(Ag-Au-Co)EDV.TO
Mining Q2 2015 AISC/oz of $898, Profit of $33M And $20M Debt Payment in July
CA$ 0.51+8.51%Trend Power :
Corporate news
Mawson Res.(Au-Ur)MAW.TO
Restarts Drilling at the Palokas Gold Prospect in Finland
CA$ 0.17+6.25%Trend Power :
Corporate news
Goldcorp(Cu-Le-Zn)G.TO
Achieves Record Quarterly Gold Production; Updates 2015 Cost Guidance
CA$ 17.45+6.01%Trend Power :
Production
Claude Resources(Au-Cu-Ngas)CRJ.TO
Provides Date for Q2 Results and Conference Call
CA$ 0.65+3.17%Trend Power :
Corporate news
Richmond Min.(Ur-Au-Gems)RMD.V
- Exploration Update
CA$ 0.09+0.00%Trend Power :
Corporate news
Arianne Phosphate(Ur-Mo-Ti)DAN.V
Extends the Term of Warrants
CA$ 0.88+2.33%Trend Power :
Financings
Anaconda Min.(Au)ANX.TO
Reports 12.83 g/t Gold Over 4.38 Metres and 8.55 g/t Gold Over 4.97 Metres from Channel Sampl
CA$ 0.05+25.00%Trend Power :
Corporate news
Comments closed