U..S. senators want to target Russia's gold reserves

WASHINGTON (Mar 9)  A group of bipartisan U.S. senators is introducing a bill that would curb Russia's ability to liquidate its gold reserves as escalating sanctions are hurting the country's economy.

The legislation aims to deter the buying of Russian gold.

"The free world's sanctions are devastating Russia's economy — and as long as Putin continues his unprovoked and horrific invasion of Ukraine, we must keep up the pressure," said Senator Angus King (I-Maine) in a statement. "Russia's massive gold supply is one of the few remaining assets that Putin can use to keep his country's economy from falling even further."

The bill was introduced by Senator Angus King (I-Maine), John Cornyn (R-Texas), Bill Hagerty (R-Tenn.), and Maggie Hassan (D-N.H.).

According to the latest IMF data, Russia held nearly 2,300 tonnes of gold as of the end of January — the fifth-biggest sovereign gold owner.

U.S. senators want to make sure Russia cannot use its $130 billion worth of gold to avoid sanctions introduced by the West. The bill attempts to close a loophole of Russia buying domestic gold and selling it to international markets, explained Senator Maggie Hassan (D-N.H.)

"This bipartisan bill closes a critical loophole that would allow Russia to sell off its gold reserves to prop up the Russia economy," Hassan said. "The U.S. and our allies must be steadfast in standing up to Russian aggression and ensure that we block any escape hatch Putin has in getting around the full weight of our sanctions."

At the beginning of March, the Bank of Russia said it would be restarting its official domestic gold purchases after a two-year hiatus. Some analysts also warned that Russia could soon resort to gold-selling to battle sanctions and a plummeting ruble.

KITCO