Behind Russia’s gold buying spree
from Al Jazera Russia is spending more on gold than at any time since the break-up of the Soviet Union. Over the past year, Moscow has spent more than $7bn on gold, and now its total gold holdings of 1,208 tonnes are worth $49bn – making Russia the fifth biggest holder of gold in the world. The United States has the most, with almost eight times that amount. At the same time, Russia’s currency reserves have shrunk by more than $100bn as it defends the rouble’s rout. Russia is a nation in recession, its economy is under Western sanctions, and its biggest export, oil, is under pressure. So could President Vladimir Putin be pushing back through this gold shopping spree? He has railed against the dominance of the dollar and has dumped some of the country’s holdings of US government debt. It has been termed as a kind of financial weaponisation. So what is driving Moscow’s gold buying spree? Can Russia back its currency with gold? Is gold a geopolitical financial weapon? Or are sanctions really forcing Putin to dump his foreign currency reserves? Bill Browder, the founder of Hermitage Capital, at one time the biggest investor in Russia, talks to Counting the Cost. Ukraine’s economic challenge Russia’s presence in Ukraine has brought Western sanctions onto Russia, but it has also pushed Ukraine to the brink of bankruptcy, and into an IMF-led $40bn bailout.