Putin has sold gold
Russia’s recent move indicates how deep the economic pressure has become amidst the war. Vladimir Putin’s government has sold about 22 tons of gold so far in 2026, so that it can handle the growing budget deficit. As the Ukraine war enters its fifth year, pressures on defense spending, energy costs and the currency have jolted the economy. This decision has created a stir in the global gold market and has raised new questions among investors.
The Central Bank of Russia has sold 21.8 tonnes of gold so far in 2026, which is equivalent to about 22,000 kg. This step has been taken at a time when the country’s budget deficit has reached $61.2 billion by the end of March. According to the Central Bank of Russia, by April 1, 2026, the gold reserve will come down to 2,304.76 tonnes, in which a decline of 6.22 tonnes was recorded in March alone.
The ongoing war with Ukraine has put huge pressure on the economy. On one hand, government expenditure is increasing rapidly, while on the other hand, pressure on the ruble and inflation have made the situation difficult. Amidst this, there has been a tremendous surge in the demand for gold at the domestic level. According to Moscow Exchange data, gold trading volume in March increased by more than 350% year-on-year to 42.6 tonnes. Interestingly, despite the sale of gold, its total value has increased, because the prices in the international market remain near record levels. After prices rose above $5,500 an ounce in January, Russia sold 3 lakh ounces of gold, raising about $1.4 to 1.68 billion.
Experts believe that Russia is not the only such country. Many central banks are selling gold to meet rising expenses, especially on defense and energy. However, in the long term, Russia has only strengthened its gold reserves. Between 2002 and 2025, it had purchased more than 1,900 tonnes of gold, but after 2020 the pace of purchasing slowed down considerably. Meanwhile, Russia’s gold trade with China has also increased. Exports of precious metals to China will almost double in the first half of 2025. Also, at the domestic level, people have increased investment in gold to keep their savings safe. Russians have bought a record 75.6 tons of gold in 2024.
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