Russian Central Bank Keeps Buying Gold At Large Discounts To Back Exports

(February 17, 2020 - Sourav D)

The Central Bank of Russia has been maintaining large discounts while buying gold thus far this year in a bid to bolster exports of the precious metal for both large lenders alongside heavyweight miners. Meanwhile, in an emailed response to a press agency, adding that the CBR (Russia’s Central Bank) was maintaining a steep discount on gold purchasing rates that was set on December 2019, the CBR’s press service said on Friday (February 14th), “The Bank of Russia is now buying gold on pricing terms, including discounts that have been set since December 2019.

” In point of fact, despite being the largest buyer of the precious metal in the Russian Federation, the Central Bank of Russia had been maintaining a deep discount while purchasing in contrast to global futures’ prices as before mentioned aimed at developing the local market and stimulating gold exports from the country amid a spot gold futures’ price hovering near its seven-year peak.

Aside from that, since May 2019, the CBR had adopted the notion of purchasing gold at a discount, while it had stepped up discounts almost every month last year and reached a peak of 0.12 per cent and 0.21 per cent based on the type of trading.

Besides, a source close to CBR was quoted saying following Friday’s (February 14th) announcement that the discount would likely to remain in place over the coming months.