Russia May Become Net Seller Of Gold In 2nd Quarter - Saxo Bank

After years of boosting its gold reserves, Russia may become a net seller of the precious metal, Denmark-based Saxo Bank said in its forecast for the second quarter of 2020

MOSCOW (UrduPoint News / Sputnik - 02nd April, 2020) After years of boosting its gold reserves, Russia may become a net seller of the precious metal, Denmark-based Saxo Bank said in its forecast for the second quarter of 2020.

On Monday, the Bank of Russia announced it was suspending gold purchases on the domestic market starting April 1. Moreover, further decisions on the purchase of gold will be made depending on how the situation in the financial market develops, it said.

"The Russian central bank has been a strong buyer of gold in recent years. That buying has now stopped, and depending on how long it takes before crude oil recovers, we could potentially see Russia become a net-seller.

After all, they will have to cover the shortfall of oil slumping below their budget break-even, which is somewhere close to $40/b," Saxo Bank analysts said.

The Russian budget for 2020 is balanced at $42.4 per barrel of Urals, its main export blend of oil.

As of March 1, Russia has about 2,300 tonnes of gold worth about $120 billion in its international reserves, with 140 tonnes added in the past 12 months alone. Russia's gold production was about 350 tonnes last year.