Countries began to return their gold reserves against the backdrop of sanctions against Russia

A growing number of countries have begun to return their gold reserves as a preventive measure to protect against sanctions similar to those imposed by the West on Russia. About it informs Reuters, citing data from a survey of central banks and sovereign wealth funds conducted by the American investment company Invesco.

Sovereign funds are reviewing their strategies, expecting higher inflation and geopolitical tensions to persist, the agency writes. According to the poll, a “significant proportion” of central banks are concerned about the precedent of blocking Russian gold and foreign exchange reserves in 2022. Nearly 60% of respondents noted that the situation made gold a “more attractive” asset. At the same time, 68% of respondents said they prefer to keep reserves in their country (vs. 50% in 2020).

One of the central banks, speaking on condition of anonymity, said that the country’s gold reserves were previously held in London, but have now been transferred back to “keep it safe,” writes Reuters.

In addition, geopolitical tensions, coupled with opportunities in emerging markets, are pushing some central banks towards currency diversification. 7% of respondents said that the growing US debt is a negative factor for the dollar. However, most still see no alternative to it as the world’s reserve currency. The share of those who are confident that the Chinese yuan can become such a currency has fallen to 18% from 29% last year.

Against the backdrop of a special operation in Ukraine, Western countries imposed large-scale sanctions against the Russian Federation, and also froze Russian assets abroad. In March 2022, Finance Minister Anton Siluanov declaredthat because of the sanctions, Russia has lost access to about $ 300 billion of gold and foreign exchange reserves. He estimated the total amount of reserves at $640 billion.

In November 2022, the head of the European Commission, Ursula von der Leyen reportedthat the West blocked 300 billion euros of Central Bank reserves and 19 billion euros of private funds of businessmen connected with Russia. On July 3 this year, European Commissioner for Justice Didier Reynders clarifiedthat the amount of frozen Russian assets in the EU after the start of the military operation in Ukraine is 207 billion euros.

The Russian authorities have repeatedly noted the unreliability of the dollar and pointed to the beginning of the process of de-dollarization in the world. At the same time, Russian President Vladimir Putin emphasizedthat Russia does not have the goal of de-dollarization of its own and the world economy.

At the beginning of May at the IMF reportedthat observe a gradual decline in the role of the dollar in the global economy. At the same time, IMF Managing Director Kristalina Georgieva added, there will be no alternative to this currency in the near future.