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Russia's central bank says its operations with gold are increasing
Published by Global Banking & Finance Review®
Posted on November 19, 2025
3 min readLast updated: January 20, 2026
Quick Summary
Russia's central bank boosts gold operations due to sanctions, increasing domestic market liquidity and shifting reserves to yuan and gold.
Russia's Central Bank Expands Gold Operations Amid Sanctions
MOSCOW (Reuters) -The Russian central bank said on Wednesday that its sales and purchases of gold in the domestic market for the budget reserve, the National Wealth Fund (NWF), have been increasing in recent years due to the enhanced liquidity of gold.
The central bank's assets in U.S. dollars, euros, and other major Western currencies have been frozen as part of Western sanctions imposed on Russia over its military actions in Ukraine.
In 2023, Russia excluded the U.S. dollar, euro, and other Western currencies from the currency structure of its fiscal reserves, which are now held in China's yuan and gold, with target shares of 60% and 40%, respectively.
"Yuan and gold are liquid assets of the NWF. The purchase or sale of liquid currency assets of the NWF for roubles entails the central bank conducting equivalent volume operations in the domestic market," the central bank stated.
Due to the rally in global gold prices, the turnover of gold in the domestic market has grown, enabling the central bank to intensify its transactions in gold. The bank did not specify when it had increased the transaction volume.
LIQUIDITY OF RUSSIA'S GOLD MARKET ALSO RISING
The central bank cannot buy gold in international markets due to sanctions. Although Russia ranks as the world's second-largest gold producer after China, the low liquidity of the domestic market previously limited the central bank's ability to increase operations.
"Since the liquidity of the domestic gold market has increased in recent years, the central bank conducts equivalent operations not only through the purchase and sale of yuan for roubles but also partially through the purchase and sale of gold," the central bank said.
As of November 1, the liquid assets in the NWF, comprised of yuan and gold, amounted to $51.6 billion, or 1.9% of the projected gross domestic product (GDP). These assets could be used to cover the budget deficit.
The NWF retains roubles from the state budget's excess oil revenues, while the central bank handles transactions in gold and foreign currency for the fund. It has been selling foreign exchange and gold on a net basis throughout 2025.
The foreign currency and gold held on behalf of the NWF are accounted for as part of the central bank's gold and foreign exchange reserves, which stood at almost $720 billion, including the frozen assets, with the share of gold at over 41%.
(Reporting by Elena Fabrichnaya; Writing by Gleb Bryanski; Editing by Alexandra Hudson)
Key Takeaways
- •Russia's central bank increases gold operations for the National Wealth Fund.
- •Sanctions freeze assets in Western currencies, shifting focus to yuan and gold.
- •Gold market liquidity in Russia has improved, boosting domestic transactions.
- •Russia's fiscal reserves now prioritize yuan and gold over Western currencies.
- •The National Wealth Fund's liquid assets are valued at $51.6 billion.
Frequently Asked Questions about Russia's central bank says its operations with gold are increasing
1What is a central bank?
A central bank is a financial institution responsible for managing a country's currency, money supply, and interest rates, often overseeing the banking system and implementing monetary policy.
2What is liquidity?
Liquidity refers to how easily an asset can be converted into cash without affecting its market price. High liquidity means assets can be quickly sold or bought.
3What is a currency reserve?
Currency reserves are foreign currencies held by a central bank to support its domestic currency's value and manage exchange rates, often used in international trade.
4What is the National Wealth Fund?
The National Wealth Fund is a sovereign wealth fund that manages a country's financial assets, often used to stabilize the economy and support budgetary needs.
5What is gold's role in finance?
Gold serves as a safe-haven asset and a hedge against inflation and currency fluctuations, often used in investment portfolios and by central banks to diversify reserves.
