The mission led by Vladimir Putin is trying to break down Russia’s dependence on the U.S. dollar by rushing towards investing in gold.
Bullion reserves of the country have been increased to 400% within the last 10 Years, and the most aspiring year was 2018. The mission is achieving its goals at a constant pace so far this year. On the basis of data obtained from the central bank, gold assets rose by 1 million ounces in the month of February, the maximum in the past three months.
The data reveals that Russia is gaining quick progress in the huge mission of making the country free from American assets. Several Russian analysts have coined the whole scenario as a term de-dollarization. They weighed the possible impact on the global economy if many other countries also adopt the Russian philosophy by investing in gold or Chinese currency, Yuan.
Several experts are raising doubts about whether Russia can afford to maintain its intense pace of continuously investing in gold. According to some experts, the country will import more bullion to secure against geopolitical shock waves and the possible risk of threatening the US sanctions, as relations between both the strong global powers continue to fade.
It was for the first time that gold purchase volume exceeded the mine supply in the last year.
In order to maintain the Russian dollar at higher levels, the country should focus on exporting commodities, such as oil. In the three quarters of the year, the country generated oil trading worth $ 600 Billion.
In almost three years, Bullion price has increased by more than 20%. By the end of the last week, the gold was trading at $ 1,297.15 for an ounce in London.
Russia’s strategy behind purchasing gold is understandable at the global level. So, it would significantly increase the purchases to substantially influence the gold price.