In 2026, the Central Bank of Russia (CBR) sharply increased gold sales from its international reserves, becoming the world’s largest seller of the precious metal among central banks by the end of the second quarter. This was reported by Dengi.ua with reference to The Moscow Times.
According to statistics from the World Gold Council (WGC), the Russian regulator sold 21.77 metric tons of gold from its reserves between April and June. The Central Bank of Turkey ranked second in terms of sales volume, selling 4.23 metric tons. The scale of sales by the other sellers was significantly smaller: Mexico sold 0.1 metric tons, Malta sold 0.03 metric tons, and Romania sold 0.01 metric tons.
At the same time, a number of countries, on the contrary, were actively replenishing their gold reserves. The Central Bank of Poland purchased the largest amount - 50.79 metric tons. It was followed by the People's Bank of China, which purchased 32.97 metric tons, and the Central Bank of Uzbekistan, which purchased 16.17 metric tons.
As Finam analyst Alexander Potavin notes, the Russian regulator is selling gold primarily to “use the proceeds to cover the state budget deficit and the shortage of foreign exchange liquidity.” According to the Bank of Russia’s own data, from January through the end of July, 1.6 million troy ounces - or about 49.7 metric tons - were threshed/liquidated from the country's reserves.
The current sales volumes are the largest since the 1998 default. At that time, following the collapse of the market for short-term government GKO bonds, Russia sold 3.8 million troy ounces of gold - approximately 118 metric tons - over a three-month period. These figures are provided by the International Monetary Fund. As of August 1 of this year, the Russian Central Bank’s gold reserves had fallen to 73.2 million troy ounces - the lowest level since 2020.
Elina Rybakova, an economist at the Peterson Institute for International Economics, believes that the Kremlin’s decision to begin selling gold indicates that “they are running out of other liquid assets.” In the early days of the war against Ukraine, the Russian Central Bank lost access to $300 billion in gold and foreign exchange reserves held in dollars, euros, and other Western assets, which were frozen as part of sanctions. The regulator was left with about $100 billion in foreign exchange reserves, primarily in Chinese yuan.
According to Rybakova, the situation with gold reserves points to “growing pressure” due to the Russian budget deficit and “pressure regarding sources to finance this deficit.” According to data from the Russian Ministry of Finance, the federal budget deficit reached 6.45 trillion rubles (about $74.6 billion - Ed.) in January–July, while for the entire previous year it amounted to 5.7 trillion rubles ($65.9 billion).
However, Chris Weifer, an analyst at Macro-Advisory, believes it is not worth interpreting the sale of gold as a sign that Russia has “gone bankrupt.” According to his estimates, the Russian Central Bank’s gold reserves remain the fifth-largest in the world, and since the current reduction began, their volume has decreased by only 2.1%. At the current sales rate - approximately 200,000–300,000 troy ounces per month - it could take about two decades to fully liquidate the reserves.
Alexander Potavin suggests that the Central Bank of Russia will continue to reduce the gold component of its reserves. At the beginning of the year, gold accounted for about 48% of Russia’s reserves, and now its share has fallen to 41.5%.
“Perhaps a level of around 40% or slightly below could serve as a threshold. However, as long as there remains a need to cover a significant budget deficit, the share of gold in reserves may continue to decline,” Potavin believes.