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McDowell Speaks with Grid About Russia’s Gold Reserves

July 21, 2022


Daniel McDowell

Daniel McDowell

Russia, motivated by a desire to diversify away from the dollar, has been building its gold reserves for more than a decade. By this year, just before the invasion of Ukraine, the percentage of Russia's reserves held in gold stood at approximately 20 percent. The rationale behind the gold stash became evident shortly after the war began, when Western countries imposed sanctions on Russia’s central bank, blocking its access to currency reserves held in the U.S., Europe and Asia. 

“For a country like Russia that finds itself facing these kinds of sanctions, your traditional reserve assets can be rendered effectively useless,” says Daniel McDowell, associate professor of political science. Nearly all of Russia’s gold sits in Russian vaults. Because of that, McDowell says, “Right now, those reserves are out of reach of the U.S., Europe and any potential adversaries that might want to cut off its assets.”

Read more in the Grid article, "Russia’s bright, shiny anti-sanctions weapon: Inside the billion-dollar business of ‘blood gold’."

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