In September, Russia’s official Gold stock fell by roughly 62 metric tons since December 2025, bringing the total to about 2,264 metric tons. This level marks the lowest reserve count since 2019, according to the Bank of Russia’s latest figures. The decline comes at a time when the state budget is under intense strain, with wartime expenditures and dwindling oil and gas revenues forcing policymakers to tap other assets.
The first eight months of 2026 saw the budget gap widen to 5.8 trillion rubles (about US$68.4 billion), far beyond the full-year target of 3.8 trillion rubles (US$44.8 billion). To bridge the shortfall, authorities have drawn on the national wealth Fund, a move that directly impacts the central bank’s gold balance. At the same time, Moscow plans a 27 percent boost in defence spending for 2027, taking the allocation to 17.1 trillion rubles (US$202.58 billion), the highest level since 2022. The combined fiscal pressure explains why the bank has now reduced its gold holdings for ten consecutive months.
Export shift to Asia and record sales
While the domestic stockpile shrinks, the flow of Russian gold abroad has accelerated, especially toward Asian markets. Hong Kong emerged as the leading destination, importing 112.7 tons of Russian gold in the first seven months of 2026—already surpassing the entire 2025 volume of 92.1 tons. China followed closely as a major buyer, underscoring a clear pivot away from traditional European channels.
The World Gold Council’s September 2026 update highlighted that central banks collectively purchased a net 23 tons of gold in July, but Russia stood out as the biggest net seller, shedding approximately 6 tons that month. In September alone, the Bank of Russia sold 200,000 troy ounces—equivalent to 6.2 metric tons—bringing sovereign holdings down to 72.8 million troy ounces, the lowest figure since 2019. The monetary value of the reserves fell to US$301.6 billion at month-end, down from US$333.4 billion the previous month.
Official stance and production controversy
Central Bank Governor Elvira Nabiullina addressed the contraction on 11 September, explaining that the modest dip mainly reflects operations by the Finance Ministry using funds from the National Wealth Fund, as stipulated by Russia’s fiscal rule. She added that a portion of the gold is also earmarked for coin production and emphasized that the bank will not disclose further details of its gold transactions.
Earlier in the year, the country’s natural resources minister announced a 2025 gold output of 485 tons and projected 480-500 tons for 2026. Independent analysts from Metals Focus, however, estimate that actual mine production is roughly 28.8 percent lower than the official claim, pointing to growing uncertainty around the sector amid Western sanctions. Despite the discrepancy, Moscow continues to promote its status as a global gold producer, citing new discoveries and expanding reserves as evidence of a resilient mining base.
Overall, the intertwining of a widening budget deficit, a sizable defence budget boost, and a strategic shift in gold export markets paints a picture of a central bank that is leveraging its precious-metal holdings to meet pressing fiscal needs while navigating a complex international sanctions environment.
