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Gold transactions between Americans and Russia are prohibited, according to a US Treasury Department notice that cited executive orders signed by President Joe Biden.
The notice marks a setback for Russia's currency, which could be bolstered by sales of the country's massive gold stash. The beleaguered ruble has tumbled as the US and Western allies issue economic and financial bans on Russia for launching a war against Ukraine last month.
"U.S. persons are prohibited from engaging in any transaction — including gold-related transactions — involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation," the Treasury Department said Thursday in its Frequently Asked Questions section about financial sanctions on its website.
Russia holds the world's fifth-largest gold stockpile. Its holding of roughly 2,300 tons of the precious metal was recently valued at nearly $140 billion. The country has been building its gold stockpile with the aim of it acting as an economic insurance policy for the country.
Gold demand within Russia has been strong as residents seek to protect their wealth from the sliding ruble. The Russian currency dropped below 1 cent against the US dollar after Russia attacked Ukraine on February 24. President Vladimir Putin ordered the attack after months of amassing troops on Ukraine's border.
The ruble has dropped about 26% this year against the greenback, while gold prices have risen more than 7% during 2022.
