Central Banks Expand Gold Reserves in May

Russian Central Bank

(Bloomberg) – Russia, Kazakhstan and Turkey raised their gold reserves holdings in May on lower gold prices to diversify assets.

Russia expanded its gold reserve holdings by 6.2 metric tons to be 996.2 tons in May. Russia expanded its gold reserve this year by 4% and 8.5% last year, according to the International Monetary Fund (IMF) data. According on World Gold Council (WGC) 2012 data, the Russian gold reserve was 976.9 representing 9% of Russia’s national Foreign Exchange Reserves.

Turkey increased its gold reserve holdings by 18.2 metric tons in May to be 445.3 tons. It also increased its gold holdings by 33 tonnes in April, making this the 11th month they expand their gold reserves. It held 375.7 tonnes of gold representing 16% of their national Foreign Exchange Reserves in 2012, according to WCG data.

Kazakhstan, the former USSR state that declared independence in 1991, increased its gold reserve by 4 metric tons to be 129.5, growing by 12% this year and 41% in 2012. Kazakhstan held 115.3 tonnes of gold representing 22% of their national Foreign Exchange Reserves in 2012, according to data from WGC.

Along with Turkey, Kazakhstan and Russia, Azerbaijan, Greece, Kyrgyz, Brunei, Nepal and Mongolia bought gold bullions for their reserves during the past two months, according to the IMF data.

On the other hand, Mexico and Czech Republic cut their gold holdings in May. Canada and Belgium also reduced their gold reserves holdings on April amid April’s fall.

Central Banks in Asia and Eastern Europe see the current prices are attractive. Central Banks buying might support gold prices from dropping and nullifying the weak Asian physical gold demand.