by Grigori Gerenstein
January 24, 2011 (The Wall Street Journal) — The Central Bank of Russia plans to buy from domestic banks 100 metric tons of gold a year in order to replenish the country’s gold reserves, Deputy Head of the bank Georgy Luntovsky said Monday, according to the bank’s press service.

In 2010 Russia’s gold reserve increased 23.9% to 790 tons, or 25.4 million Troy ounces.

[source]

RS View: Based on the figures cited for 2010, the official Russian gold reserves were increased by 152 tonnes last year, so I would like to know why the term “replenish” was used. Is it in regard to a level of generic state holdings that have not been included among its official gold reserve declaration, or does it refer to levels once held during a more distant era?

Additional item of interest…

CBR Press Release
(Central Bank of the Russian Federation) — On February 1, 2011 the Central Bank of the Russian Federation issues a gold proof commemorative coin in denomination of 1000 Rubles “The 150th Anniversary of the Beginning of Great Reforms. The Manifest of February 19, 1861 about the Abolition of Serfdom.” … The coins are legal tender of the Russian Federation. They are obligatory for acceptance for all kinds of payments without any restrictions at their face value.

RS Note: While not issued in numbers sufficient to get excited about the prospect of ever seeing one except as pictured in this press release or in some rare gent’s private collection, the element that merits its mention here is regarding the standard language the central bank has used regarding the legal tender status — “obligatory for acceptance for all kinds of payments without any restrictions at their face value.” These are the good signs of yet another bank that fully appreciates the necessity for gold not to be tethered as currency to a fixed price/value but rather to float freely against the domestic monetary unit.

Furthermore, the Bank understands the value served to society in issuing “coins of precious metals which are not a subject to the VAT according to the Article 149 of the second part of the Tax Code of the Russian Federation.” And as more fully cited here, “Thus the conditions are being created for gold and silver coins to be used as an independent instrument for the investment of free funds.”