In 2022, investment interest in gold among Russians increased by 5 times compared with the previous year. Such demand dynamics can be explained by several reasons.
First of all, it was influenced by the financial awareness of citizens who thought seriously about how to protect their capital in the context of sanctions and economic instability. The main reason is dedollarization. Those people who collected their income in dollars for many years, began to fix it in gold.
Gold is considered traditionally a safe haven currency that guarantees the security of savings during periods of crises and collapses of stock markets. When real estate, stocks and other forms of investment lose their attractiveness, gold demonstrates growth and profitability as an asset. The metal is insured against complete depreciation, it can be controlled, since you have it physically – these are the key factors guiding investors when buying gold in conditions of uncertainty.
It is noteworthy that in 2022 in Russia the demand for this precious metal grew faster than in other countries and amounted to 2% of global demand.
The increased interest of Russians in gold is dictated also by other, more obvious reasons. Thus, investing in gold has become more affordable for Russians in March 2022, when VAT on the purchase of gold bars was canceled for individuals. Another factor is exoneration of individuals from paying personal income tax until the end of 2023 when selling gold bars. In total, this marked the government’s course towards de-dollarization and finding alternative ways to store savings.
By Evgeny Shimanovsky, co-founder of the Golden Invest Club, vice president of the Eurasian Business Alliance