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- Gold on the way out: why the Central Bank is selling precious metals at record prices
Gold on the way out: why the Central Bank is selling precious metals at record prices
Gold prices on the world market have exceeded $ 4,000 per troy ounce, updating historical highs, including adjusted for inflation, almost weekly. In many ways, this growth is caused by increased demand from central banks, which are stocking up on precious metals against the backdrop of geopolitical instability. However, this year the Bank of Russia is not on the list of buyers, which, on the contrary, sold the metal. What is the meaning of these sales at the current peak and whether such a strategy is justified in the long term — in the material of Izvestia.
A record, another record
Gold prices have increased from $2.6 thousand to $4.1 thousand per ounce since the beginning of the year, and last week they even touched the $4,350 mark. This rally has become one of the largest in history. At some point, the historical maximum adjusted for inflation was even set (the 1980 result was updated). The turmoil in the world, concerns about the government debt of the leading economies, the war of duties and other doubts about the prospects of fiat currencies supported the demand for gold like never before.
The main role, as in previous years, was played by the demand of central banks. Interestingly, the Central Bank steadily sold the precious metal in the 1990s and 2000s, and after the 2008 crisis, demand turned around. In 2023-2024, central banks set records for gold purchases. In 2025, they slightly reduced the volume of net purchases, which amount to about 20 tons per month (in August — 19 tons). The leaderboard is quite interesting. According to the World Gold Council, Poland ranks first with 67 tons. Azerbaijan, Kazakhstan, China and Turkey are also among the main buyers.
Only four countries turned out to be net sellers of gold in 2025. Uzbekistan came in first place, and Singapore came in second. The third in the list is Russia, which sold about 8 tons of precious metal in January-August. However, in September, the Bank of Russia returned to shopping for the first time in a year and a half, acquiring just over 3 tons. Nevertheless, the balance for nine months is negative.
The fight against inflation is in the first place.
In general, Russia has been actively replenishing its gold reserves in previous years. If in the early 2010s the Russian Federation was not even in the top ten largest owners of gold, then in 2025 it was in fifth place. At the same time, the value of precious metal reserves grew even faster. Since the fall of 2023, it has doubled from $140 billion to $282 billion. Mainly due to the revaluation, because, as noted above, physical volumes practically did not grow during the specified period.
The decrease in purchases and the transition to sales look quite interesting. On the one hand, it is obvious that current prices are exceptionally high by historical standards. With super-expensive gold, there is a certain temptation to buy more, but you can end up in a bubble by buying, as traders say, "on the hay." However, the global situation remains uncertain, and most analysts predict a further increase in the value of gold. Because it is a traditional asset of last resort, coming into play when the credibility of most other backup options is undermined. Moreover, unlike bitcoin, gold is a carrier of utilitarian value. Its position as insurance is more stable.
What motivates the Russian Central Bank in its pause in gold purchases and transition (probably temporary) to its sale — so far in small amounts?
According to Evgeny Goryunov, head of the Monetary policy laboratory at the Gaidar Institute, the Bank of Russia sells gold as part of so-called mirroring operations.
— When the state budget spends NWF funds, additional rubles are poured into the economy, — says the expert. — To neutralize the effect of this infusion on the financial system, the Central Bank sells currency or gold. In this case, the sale of gold is not related to asset management, but to the Central Bank's desire to maintain predictable dynamics of the money supply when the Ministry of Finance is actively spending funds to finance the deficit.
Kirill Lysenko, an analyst on sovereign and regional ratings at the Expert RA agency, voiced similar conclusions in an interview with Izvestia. According to him, the purchase of gold by the Bank of Russia increases the ruble money supply and can fuel inflation if it is not accompanied by sterilization. In the context of tight monetary policy and increased inflationary risks, the Central Bank refrains from expanding the ruble issue for gold.
— In addition, the share of gold in reserves is already high (39.6% of the value of international reserves as of October 1, 2025), especially since precious metals, as before, remain an asset with limited liquidity, especially in the realities of sanctions restrictions. In addition, against the background of high world prices, its additional accumulation looks economically unjustified. Accordingly, maintaining the current reserve structure is a rational choice," Lysenko believes.
There is no hard ceiling
— In my opinion, in this case, the Bank of Russia is forced to sell gold. This is due to the need to comply with the budget rule, which requires the sale of currency or gold. However, when there is a shortage of convertible currency, it is gold that has to be sold," says Alexander Abramov, head of the Laboratory for the Analysis of Institutions and Financial Markets at the Presidential Academy.
According to him, the operations of the Bank of Russia to sell gold on the market cannot be considered as measures to stabilize prices for this metal. After all, the world's precious metals pricing centers are located outside the Russian Federation.
At the same time, another motivating factor may be that the Central Bank buys gold mainly from new Russian production. Companies mining the precious metal can lobby for an increase in its share in international reserves, hoping for new orders. In the past, this arrangement was an advantage: the Central Bank could safely build up reserves without spending foreign currency. Fortunately, Russia was in a confident second place after China in terms of global production in 2024, producing 330 tons of gold. But now such a factor as the ruble exchange rate is coming to the fore. With a strong Russian currency, purchases of precious metals in reserve become much less profitable.
It has often been discussed in Russia that the Central Bank has a certain hard ceiling on the share of gold in reserves. But in reality, regulations are more likely to be floating and dependent on the specific situation in the markets, as well as in the global conjuncture, both economic and political.
— The regulator has a simple age-old rule of thumb for a share in gold reserves (gold and foreign exchange reserves. — Izvestia) no. The Central Bank adjusts the structure of the gold reserves portfolio based on its models, which determine forecasts for further necessary actions to maintain monetary and financial stability," explained Kirill Lysenko.
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