Gold Serving as a Lifeline for Russians Coping With a Wartime Economy
By Mike Maharrey
Gold has served as a lifeline for the Russian government and economy in the wake of aggressive sanctions after it invaded Ukraine.
It has also served as a lifeline for the Russian people.
Russians bought a record amount of gold in 2024. According to a report by Bloomberg, consumers gobbled up nearly a quarter of the country’s annual gold production. In 2023, Russia was tied for second in global gold output.
Russian consumers bought 75.6 tonnes of gold last year in the form of coins, bullion, and jewelry, a 6 percent annual increase.
Russian retail gold demand in 2024 ranked fifth in the world.
Since its invasion of Ukraine, gold demand in Russia has skyrocketed by 60 percent.
According to Bloomberg, Russians have turned to gold seeking “alternative ways of securing their savings instead of traditional investments in dollars or euros.”
Aggressive Western sanctions have made it difficult to secure dollar and euro-denominated assets, sending average Russian people scrambling to protect their wealth. Gold provides the perfect alternative. It is recognized as money around the world, is accepted virtually everywhere, and comes with no counterparty risk.
Holding gold also shields Russians from spiking price inflation. Russia’s CPI came in at over 9 percent on an annual basis in December. This has forced the Russian central bank to raise interest rates, now set at 21 percent.
The price of gold jumped by 28 percent in ruble terms in 2024 and is already up by 10 percent so far in 2025.
The Russian gold rush underscores the nature of gold as money and its important role in the global economy. When fiat currencies are cut off or fail, gold will always remain a viable alternative.
This is precisely why so many Russians are accumulating gold at a rapid pace.
Originally Published on Money Metals.
