In a significant move, Russia’s Finance Ministry has announced plans to allocate 8.2 billion rubles ($92 million) each day for gold and foreign currency purchases until October 4, the nation’s Finance Minister announced.
“The amount of funds allocated for purchases of foreign currency and gold totals 172.9 billion rubles,” the ministry said in a statement. “Transactions will be carried out from September 6 to October 4, 2024, respectively, daily volume of purchase of foreign currency and gold will equal 8.2 billion rubles.”
This marks a sevenfold increase in purchases of physical precious metals over the previous spend, which has already been much higher for the last year. The Finance Ministry also projected “windfall” oil and gas revenues of 162 billion rubles in September, noting that actual oil and gas revenue in August exceeded initial expectations by 10.9 billion rubles ($129 million).
These revised figures “make it possible to estimate the volume of operations conducted by the Bank of Russia on the currency market related to the replenishment and use of the National Wealth Fund,” the ministry added.
With the new transaction volumes set for the September 6 to October 4 period, the Central Bank is expected to sell 0.2 billion rubles per day during the previous period.
After an 18-month hiatus, Russia’s finance ministry resumed gold and currency purchases in August 2023, capitalizing on higher oil prices. The country had previously paused foreign exchange interventions in January 2023, selling yuan reserves as part of a budgetary strategy to shield the economy from commodity market volatility. This program was initially suspended following the invasion of Ukraine in February 2022.
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