Russia has begun selling off its gold reserves to cover its budget deficit

For the first time since the early 2000s, Russia has begun selling physical gold from its reserves to cover the federal budget deficit.

According to the Central Bank of Russia, approximately 300,000 ounces of gold were sold in January, and another 200,000 in February. As a result, gold reserves fell to 74.3 million ounces—the lowest level in the past four years.

In total, about 14 tons of gold were sold over two months—the largest volume since 2002.

As noted, gold transactions were previously largely formal in nature—the metal was sold within the state system between the Ministry of Finance and the Central Bank. Now, however, these are actual market sales.

The reason cited for these actions is a significant budget deficit, which exceeded 15 trillion rubles for 2022–2025, as well as the government’s reluctance to fully deplete its yuan reserves—effectively the last available tool to influence the ruble exchange rate amid sanctions.

After three years of unexpected economic growth, Russia is facing a sudden slowdown—war costs, inflation, and falling oil prices have begun to weigh on an economy that until recently seemed resilient to sanctions.

Consumer lending in Russia has fallen to a six-year low.