Russia Plans to Buy Silver for its National Reserves

According to a report from Russian news agency Interfax last week, Russia plans to significantly increase its holdings of gold, silver, platinum, palladium and gemstones. The report states that the nation plans to allocate 51.5 billion Rubles (AU$796.89m) in each of 2025, 2026 and 2027.

While the report doesn’t state how much of the allocated Rubles will go to acquiring silver, this is a particularly significant event because silver is not currently used as a reserve asset across the world. As we’ve spoken about several times, central banks have been purchasing gold at record levels in recent years which has helped to push the price to record highs. Silver, however, has not experienced the same price appreciation, but this development may be the trigger to see it push past US$50/oz and well beyond. The white metal is already forecasted to be in a supply deficit over the coming years (due largely to continued increases in industrial demand, especially in the green energy sector), and those numbers certainly don’t factor in a nation-state adding it to their reserves.

In the case of retail investors, silver is considered more affordable than gold, given the gold-to-silver ratio stands at 83.57. This kind of thought may well prevail among central banks, and this Russia step might be the way for others, including BRICS nations, to emulate.

Not only is it perceived by many to be undervalued, but buying silver is another way for central banks to diversify their assets in a move away from having reserves dominated by U.S. dollars. This trend has been playing out for some time now, with central banks growing increasingly concerned with rising levels of debt, currency debasement, and geopolitical risk in Europe and the Middle East.

On the topic of trends, the price action for silver has been set up in a way that could greatly reward investors. It’s funny how big news often ties in nicely with price action that has been building for a long time. The below monthly chart, which includes two decades of price action, shows a bullish break from the long-term triangle pattern that may signal the start of the next silver bull run.

Source: zerohedge.com

The following chart shows a very bullish Cup and Handle pattern that’s formed on the logarithmic chart dating way back to the 1960s.

Source: zerohedge.com