Gold and foreign currency reserves up $1bn (Russia)

Russia’s gold and foreign currency reserves were $302.7 billion as of 19 January 2007, up $1bn, or 0.3 percent, from $301.7 billion a week before, the Central Bank of Russia has reported. In the previous week ending January 12 the reserves decreased by $2.2 billion.

The current level of the gold and foreign currency reserves is $300 million below their level reported on 29 December 2006, or three weeks ago.

The slower rise in the reserves is due to the reduced acquisition of foreign currency on the domestic forex market by the Central Bank. This seems to be the bank’s long-term strategy. Alexei Ulyukayev, Senior Deputy Chairman of the Central Bank, said the reserves would increase by between $70 million and $80 million in 2007, a mere fraction of the $118 billion rise in 2006. The Central Bank purchased a total of $140 billion last year, Ulyukayev said.

From 1 December 2006 to 1 January 2007, Russia’s gold and foreign currency reserves increased 5.08 percent to $303.732 billion. Gold reserves rose 1.14 percent from $8.072 billion on 1 December 2006 to $8.164 billion on 1 January 2007. The reserve position in the IMF was up 21.8 percent at $284 million, and the Special Drawing Rights remained unchanged at $7 million.

Gold and foreign currency reserves are highly liquid financial assets controlled by the Central Bank and the Finance Ministry. They consist of monetary gold, special drawing rights, the reserve position in the International Monetary Fund, and foreign currency. Fifty percent of the reserves are US dollars, 40 percent are euros, and 10 percent are British pounds and Japanese yens.