Issue link: http://resourceworld.uberflip.com/i/1058321
D E C E M B E R / J A N U A R Y 2 0 1 9 www.resourceworld.com 37 H1 H2 Source: Metals Focus; GFMS, Thomson Reuters; World Gold Council 2010 2011 2012 2013 2014 2015 2016 2017 2018 Net central bank purchases since 2010 Tonnes 700.0 600.0 500.0 400.0 300.0 200.0 100.0 0.0 holdings. This move offers Russia independence from the US dollar amid sanctions while backing the ruble. Russia sharply reduced its holdings of US treasury bonds which have declined from US $96.1 billion in March 2018 to US $14.9 billion in June 2018. The head of the central bank is reported to have said the reduction was due to an assessment of financial, economic and geopolitical risk and the gold purchases were to help diversify Russia's wealth. During the first half of 2018, Russian central bankers added 105 tonnes of gold, bringing the total to 1,944 tonnes of gold in its vaults at the end of June. Russian gold holdings are now the fifth largest among the world's central banks making up US $76.647 billion and accounting for 17.7% of overall Russian reserves. But Russia is not the only country selling their US dollars for gold in an effort to reduce their exposure to the US dollar. Turkey nearly halved its US debt holdings to US $32.6 billion in May from $62 billion in 2017 and added 86 tonnes of gold to its to its official holdings in 2017 and another 30 tonnes of gold to its reserves in 2018 for a total of 240.2 tonnes in reserve. China is also diversifying from the US dollar, while at the same time is on a drive to promote the use of its own currency globally. The uptake has been slow, but data from Swift, the global interbank system showed that 1.86% of international pay- ments were in the denominated renminbi and rising as international banks warm up to the Chinese currency. An early adopter is Pakistan's central bank that is replacing the dollar with the renminbi for bilateral trade and investment with Beijing. In January, central banks in Europe revealed plans to hold the renminbi as part of their foreign currency reserves. In Southeast and Central Asian nations, the story is much the same. Countries have been selling US dollars to ramp up their gold holdings. The Philippines had 196.4 tonnes of gold at the end of June 2018, up 20% from 2010. Indonesia's overall gold holdings increased 10% during the period to 80.6 tonnes in part to support efforts to slash the US dollar's share of their financial assets. So, if the US dollar dominance as a reserve currency continues to wane and inten- tional monetary reserves start loading up on the Chinese renminbi and the Euro, it looks like gold could continue to be the beneficiary. n