Russia’s central bank has reduced its gold holdings to their lowest level in nearly seven years as the Kremlin faces a widening budget deficit, declining energy revenues and mounting expenditure on its war against Ukraine.

Russia has carried out its largest sustained reduction in gold reserves since the financial crisis of 1998, disposing of approximately 62 tonnes of the precious metal since December 2025 as the government draws on accumulated reserves to finance a growing federal budget deficit.

According to figures released by the Bank of Russia on Tuesday, 20 October, the country’s monetary gold reserves declined by another 200,000 troy ounces, equivalent to approximately 6.2 tonnes, during September.

The latest reduction brings Russia’s official gold holdings to 72.8 million troy ounces, or approximately 2,264 tonnes, their lowest level since the end of 2019.

The central bank has now reduced its gold holdings for ten consecutive months, reversing the accumulation strategy pursued by Moscow in the years preceding its full-scale invasion of Ukraine.

Largest gold sell-off since the 1998 crisis

The scale of the current reduction is exceptional by Russian historical standards.

According to International Monetary Fund data cited in reporting on the latest figures, the only more rapid depletion of Russian gold reserves in the country’s modern history occurred during the 1998 financial crisis.

At that time, Russia’s central bank disposed of approximately 118 tonnes of gold over three months as the government defaulted on domestic debt and the rouble collapsed.

Some of those holdings were subsequently replenished, leaving the country’s gold reserves approximately 50 tonnes lower at the end of 1998.

The reduction recorded during 2026 has already exceeded that annual net decline, although Russia’s present financial position differs substantially from the circumstances surrounding the 1998 default.

The monetary value of Russia’s remaining gold reserves stood at approximately $301.6 billion at the end of September, compared with $333.5 billion a month earlier. The change reflects movements in gold prices as well as the reduction in physical holdings.

Budget deficit reaches 7.3 trillion roubles

The sales come as the Russian government struggles to contain expenditure associated with its continuing military campaign against Ukraine.

Moscow now expects its federal budget deficit to reach 7.3 trillion roubles, approximately $87 billion, in 2026. That represents 3.2 per cent of gross domestic product, twice the deficit originally anticipated.

Military and security expenditure is expected to account for approximately 38 per cent of total federal spending this year.

The government has increasingly relied on its National Wealth Fund, established to accumulate surplus energy revenues, to cover budget shortfalls.

The central bank’s gold transactions are linked to operations involving the fund. Under this mechanism, the Bank of Russia conducts corresponding market sales following Finance Ministry transactions using the fund’s assets.

Figures published by Russia’s Finance Ministry earlier this month showed that the National Wealth Fund’s liquid assets had fallen to approximately 3.8 trillion roubles, equivalent to $45 billion, as of 1 October. This was down from approximately 4 trillion roubles a month earlier.

The fund’s total assets remained substantially larger, at almost 13 trillion roubles, but much of that amount is invested in shares, bonds and other holdings that cannot immediately be converted into funds for government expenditure.

War expenditure puts pressure on Kremlin finances

Russia’s fiscal problems have been compounded by weaker oil and gas revenues, a slowdown in economic activity and the increasing cost of sustaining military operations.

Although energy exports continue to generate substantial income, government revenue has failed to keep pace with spending commitments.

Moscow has consequently increased domestic borrowing, introduced additional taxes and sought alternative sources of budget financing.

The latest gold figures provide further evidence of the financial demands imposed by the war, now approaching its fifth anniversary.

They do not indicate that Russia is approaching an immediate financial collapse. The country still holds considerable gold and foreign exchange reserves, with the central bank reporting total international reserves of approximately $731.8 billion at the end of September, although access to part of its overseas assets remains restricted by Western sanctions.

Nevertheless, the continued liquidation of gold holdings reduces the reserve assets available to the Russian authorities at a time when military spending remains elevated and the government faces pressure to meet its domestic financial commitments.

For President Vladimir Putin, the growing budget deficit introduces an additional economic consideration into decisions over the duration of the war.

The September figures show that Moscow is increasingly drawing on assets accumulated before the invasion to support current expenditure, while its capacity to rebuild those reserves remains dependent on future revenues and the government’s ability to restrain spending.

Union furious as bank scraps remote-first policy from February 2027, requiring all of its UK employees to come in at least twice a week

NatWest has ordered 13,000 staff to increase their in-office days from two days a month to two days a week, angering its staff union.

The banking group, which serves customers under the Royal Bank of Scotland, NatWest, Ulster Bank and Coutts brands, will require all of its nearly 40,000 UK staff to follow a strict two days a week office schedule from February 2027, abolishing a remote-first policy for thousands of employees.

• Multiple banking apps in the UK, including Revolut, faced disruptions on Tuesday morning.
• Google Cloud experienced issues with its London-based cloud region and has since said services are coming back.
• Revolut said in a statement that customers' money was safe while it investigated the disruption.

Google said it had largely resolved a cloud outage that appeared to knock out a number of online banking services.

The company said in an update at around 10 a.m. ET on Tuesday that the problem had been mitigated for the most part, with "a very small number" of customers still experiencing issues.

Google had said the outage had been caused by a "power event" at its europe-west2-b zone, which is based in London.

A handful of banking apps and services, including Halifax and Revolut, reported issues on Tuesday that coincided with Google Cloud's disruptions. Some companies said that the Google Cloud outage was the cause, while others attributed it to an unnamed third-party provider.

Users of some affected banking apps said in social media posts early Tuesday that they couldn't make card payments, log in to the app, or transfer money.

"We can confirm that all our customers' money and data are safe. We've been working to fix the issue since it was identified this morning and apologize to anyone affected and for any inconvenience caused," Revolut said in a statement earlier in the day. The outage was due to Google Cloud, a person familiar with the matter said.

"We're aware some customers are having issues with our app and online. We're sorry about this and are working hard to fix it," Halifax posted on X.

Emma, a popular UK budgeting app, also reported outages on Tuesday. "Emma is currently down due to a Google Cloud outage affecting services in London since 7 a.m. This is a technical outage, not a security issue," the company said on X.

Some took to X to share how the outage was disrupting their lives. One person said they'd had to cancel their beauty appointments in Japan, and another said their card was declined at the airport and they couldn't reach the support team.

The outage appears to have affected non-finance companies, too, according to Downdetector, a site that tracks online service disruptions.

Earlier on Tuesday, an X account for DPD, a delivery service, said in a post that its website was affected, and the web-hosting platform SiteGround said the outage has hit its UK data center. SiteGround said in its post that its engineers were working with Google Cloud engineers to address the issue.

The UK's courts and tribunal service said that it was experiencing issues with its cloud-based video tools for remote hearings on Tuesday. "We're working with our technology partners to restore service," an account for the government service wrote in an X post.

The Google Cloud outage comes as the tech giant has competed with Amazon and Microsoft to win business from enterprises, startups, and governments, particularly amid the AI boom. Reliability is a big promise built into these deals, as outages can have costly consequences for customers.

Google is not alone in being affected by outages, though: Amazon, Microsoft, and others have suffered downtime this year.

UK banking company insists customers’ funds and data are safe despite problems with sign-in, card payments, transfers and withdrawals

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Revolut customers have been unable to access their money after the banking app went down, affecting a number of services including card payments, cash withdrawals and transfers.

The UK banking company said its app was down because of a “service disruption” affecting several services, but insisted that customers’ funds and data were safe.

Bank says bulk of redundancies will occur before end of year, citing challenging economy, competition and ‘rapid technological change’

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National Australia Bank is cutting 2,500 jobs, representing 6% of its workforce, marking another significant round of cuts in a sector heavily exposed to disruption by artificial intelligence.

NAB said in a statement on Tuesday that the bulk of the redundancies would occur before the end of the year, citing a challenging economy, competition and “rapid technological change”.

Concerns financial contracts known as derivatives were incorrectly logged, potentially boosting Barclays’ profits

The Bank of England is reportedly looking into Barclays’ handling of loans linked to the embattled private credit sector.

The Bank’s regulatory arm, the Prudential Regulation Authority (PRA), started reviewing the matter this year after concerns were raised by a Barclays insider, according to the Financial Times.

For many Americans overseas, the scariest day this month is not Halloween, but October 15—the final extended deadline for filing income tax returns with the Internal Revenue Service (IRS).  

An estimated 3.3 million U.S. citizens live abroad, although the number is likely an undercount because the government doesn't keep a comprehensive list or require Americans overseas to register their residence. Still, American citizens and resident aliens living abroad must pay U.S. income taxes and comply with domestic tax filing requirements, regardless of where they live or work. They must also complete the dizzying process of reporting any foreign bank accounts, assets, and financial interests in foreign institutions. 

When filing their income tax returns, most Americans living abroad have zero tax liability. In its 2025 Annual Report to Congress, the Taxpayer Advocate Service—an independent organization within the IRS that helps people navigate tax problems—found that for Americans overseas, "the percent of individual international tax returns reporting no tax liability is significantly higher than domestic taxpayers." Yet, the agency reports that the filing process is "complex, overlapping, and punitive." The report says failure to comply results in "harsh and disproportionate penalties…even when taxpayers make good-faith mistakes or owe no U.S. tax."

The U.S. income tax rate is low compared to other high-income countries, so Americans living overseas typically pay more in local taxes than they would here. Still, Brandon Mitchener, executive director at Tax Fairness for Americans Abroad, tells Reason that Americans living outside the U.S. are often oblivious to their income tax obligations, assuming they're exempt because they already pay taxes in their country of residence. He says that complex U.S. tax laws and financial regulations force many Americans living overseas to request an extension to October 15. 

The date also coincides with the final deadline for the Foreign Account Tax Compliance Act (FATCA) and the Report of Foreign Bank and Financial Accounts (FBAR)—regulations that require Americans with foreign financial assets above a certain threshold to declare the value of their assets to the IRS or Treasury Department. 

Under FATCA, Americans living overseas with foreign financial assets exceeding $200,000 at year-end or more than $300,000 at any point during the year must declare their assets when filing their income tax return. The law also requires foreign financial institutions to report information about U.S. account holders directly to the IRS. Originally enacted to catch Americans overseas engaged in tax evasion or other criminal financial activity, it has instead made American citizenship an impediment for expatriates looking to save or invest money outside the U.S.

"Because of FATCA, many foreign financial institutions shun American clients," Mitchener says. This includes Trade Republic, a German digital bank and online brokerage firm that doesn't accept U.S. citizens living abroad, a category of people it tellingly describes as "FATCA customers."

"Some charge a premium for banking-while-American," he adds, while some have "even de-banked American clients." The latter is a very real concern for Madison Berry, an American living in the Netherlands. She tells Reason she's "a little bit worried" that her European bank will one day "come back and be like, 'Oh, you're a U.S. citizen. We're gonna close your account.'"

This "reduces choice and raises the cost and complexity of everyday financial products for Americans abroad, from basic savings accounts to mortgages and retirement savings," Mitchener says, creating problems unique to America and Eritrea, the only two countries that tax citizens living outside their borders. 

Compounding matters, Americans with foreign financial accounts exceeding $10,000 must file an FBAR with the Treasury Department's Financial Crimes Enforcement Network, even though the form duplicates much of the same information already reported through FATCA. The reporting requirements make investing or saving money abroad prohibitive for Americans and foreign financial institutions, with foreign banks opting to close existing accounts or outright denying Americans the opportunity to open a bank account, according to a 2019 report by the Government Accountability Office. Seven years later, little has changed. The IRS itself admits that its systems and functions are "inaccessible to or incompatible with the needs of taxpayers living abroad, creating unnecessary barriers to compliance." 

Berry says figuring out her tax obligations and reporting requirements has left her "in a financial limbo." "I seriously considered renouncing my U.S. citizenship as part of the process just to make life easier." She's not alone. 

Several Americans living overseas who spoke to Reason on condition of anonymity said they were also considering renouncing their U.S. citizenship rather than deal with the onerous annual tax filing process. One American living in Ireland who owns and operates a U.S.-based business says she uses a remote desktop and virtual private network to access her financial institutions to avoid scrutiny. 

Another tells Reason she's considering renouncing her citizenship because America's tax system is "predatory in how complicated it is and how much responsibility it puts on ordinary people to figure everything out themselves."

The post Why Some Americans Living Abroad Would Rather Renounce Their Citizenship Than File Taxes appeared first on Reason Magazine.

France’s borrowing costs have risen to levels last seen more than two decades ago as investors shift towards German, Dutch and other lower-risk European debt, placing Paris at the centre of renewed concern over eurozone public finances.

France is emerging as the principal source of concern in Europe’s government bond market as investors reassess the fiscal strength of eurozone states and increasingly move money towards Germany and other countries regarded as safer borrowers.

The yield on French ten-year government debt has reached its highest level since 2002 after rising by about 70 basis points during September. The difference between French and equivalent German borrowing costs approached 160 basis points last week, its widest since 2012, according to market reporting on the sell-off.

The shift represents a sharp reversal in how investors view French sovereign debt. France has traditionally traded close to Germany and benefited from its status as one of the eurozone’s largest and most liquid bond markets. It is now being treated increasingly as a country whose political and fiscal outlook warrants a substantial premium.

The immediate concern is the French budget.

Paris said in September that this year’s deficit would exceed the government’s five per cent target, while the country faces the additional challenge of issuing a record €340 billion of government bonds in 2027. The money will be needed both to finance current expenditure and refinance debt accumulated during the Covid period.

EU Today reported earlier this week that French debt concerns had already pushed the euro to a 17-month low against the dollar. Political uncertainty ahead of the 2027 presidential election has added to market concern over whether any government will be able to deliver the spending reductions required to stabilise the public finances.

Bond markets, however, are responding to France’s present position rather than promises extending into the next presidential term.

The movement is also beginning to alter longstanding assumptions about which European sovereign borrowers are considered risky.

Italy remains vulnerable. Its ten-year bond spread over Germany rose to about 130 basis points last week, compared with roughly 80 basis points a month earlier. Italian public debt stands at around 138.6 per cent of GDP, and Rome expects its deficit to move above the EU’s three per cent ceiling.

Yet French debt has recently come under greater pressure than Italian debt.

Spain provides an even more striking contrast. During the eurozone sovereign-debt crisis in 2012, Spanish ten-year bonds yielded around five percentage points more than French debt. Spain’s ten-year yield is now approximately 75 basis points below France’s.

The difference reflects stronger Spanish growth and improved confidence in Madrid’s finances, although investors are watching Spanish and Portuguese debt for evidence that the French sell-off is spreading elsewhere in the currency union.

So far, the movement is not comparable with the eurozone crisis of the early 2010s. At that time, Italian bond spreads above Germany exceeded 500 basis points and Greece’s reached thousands of basis points. Current differences remain far smaller.

The direction of capital flows is nevertheless notable. Germany has re-established itself as Europe’s principal bond-market safe haven despite questions earlier this year about Berlin’s increased spending on defence and infrastructure. German ten-year yields fell as investors bought Bunds during the recent turbulence.

Higher sovereign yields feed into the interest costs faced by governments when refinancing debt and can affect borrowing throughout an economy. For a country already running a large deficit, rising yields make efforts to restore the public finances more difficult because an increasing share of expenditure must eventually be devoted to debt servicing.

The euro fell to its lowest level against the dollar since May 2025 on Monday as investors reacted to rising French borrowing costs, political uncertainty and doubts over Paris’s ability to stabilise its public finances before next year’s presidential election.

The euro fell to a 17-month low against the US dollar on Monday as renewed pressure on French government debt raised concern over the fiscal position of the eurozone’s second-largest economy.

The single currency dropped as far as $1.116 during trading, its weakest level since May 2025, before recovering part of the fall. By late Monday it was trading at around $1.121, still lower on the day.

The move followed a sharp sell-off in French government bonds and a widening gap between French and German borrowing costs.

According to market data published on Monday, the spread between French government debt and equivalent German Bunds had approached 160 basis points on Friday, its widest level since the eurozone sovereign-debt crisis in 2011.

The gap subsequently narrowed, but the scale of the movement has drawn attention back to France’s public finances.

French debt is already close to 120 per cent of gross domestic product and is expected to continue rising.

Investors are now assessing whether Prime Minister Sébastien Lecornu’s minority government can secure sufficient parliamentary support for measures intended to put the budget on a more sustainable path.

That challenge is becoming more difficult as France approaches its 2027 presidential election.

Spending cuts and tax increases are politically sensitive even under stable parliamentary conditions. Lecornu’s administration does not have an outright majority in the National Assembly, while opposition parties have challenged several elements of the government’s fiscal programme.

The French economy itself is providing little additional room.

Revised national accounts examined by EU Today showed that the economy failed to grow during the second quarter, while household purchasing power weakened and investment declined.

Slower growth makes deficit reduction harder because tax revenues tend to grow more slowly while welfare and debt-servicing costs remain high.

Bond markets have also changed the calculation.

For much of the period following the eurozone debt crisis, France was able to borrow at historically low rates. Higher interest rates now mean maturing debt has to be refinanced at greater cost.

France’s debt burden is therefore rising at the same time as the price of servicing it increases.

The euro’s fall on Monday shows that those concerns are no longer confined to the French bond market.

Currency traders are also assessing whether fiscal pressure in France could affect confidence in the wider euro area.

The comparison with the sovereign-debt crisis of 2010–12 should nevertheless be treated cautiously.

France remains one of Europe’s largest and most diversified economies, and the eurozone now has institutional mechanisms and European Central Bank instruments that did not exist at the beginning of the earlier crisis.

There is also no indication that France is unable to finance itself.

What markets are pricing is an increase in the risk attached to holding French debt and growing uncertainty over the country’s medium-term fiscal trajectory.

The euro has now fallen for four successive weeks against the dollar and has lost more than three per cent over that period.

US monetary policy is contributing to the movement. Persistent inflation indicators have supported the dollar even as expectations of an immediate Federal Reserve interest-rate increase have declined.

For Europe, however, Monday’s trading was dominated by France.

French fiscal policy has been a domestic political dispute for much of the past year. The widening bond spread and the euro’s fall show that it is increasingly becoming a eurozone market issue.

Europe was supposed to be emerging from its inflation nightmare. Instead, the nightmare has apparently decided to return for a second act.

Eurozone inflation surged to 3.8 per cent in September, up sharply from 3.2 per cent in August and considerably above the 3.6 per cent economists had expected. It is now almost twice the European Central Bank’s 2 per cent target.

The immediate culprit is familiar: energy. Fuel and natural gas prices have been climbing sharply, while food costs are also beginning to exert pressure. Energy prices were reportedly 18.8 per cent higher than a year earlier in September, compared with a 14.3 per cent annual increase in August.

There is, however, a particularly awkward detail for the ECB. Inflation is not confined entirely to the petrol pump.

Core inflation — stripping out volatile food and energy prices — edged up from 2.4 to 2.5 per cent. Services inflation also rose to 3.2 per cent. That suggests the energy shock may gradually be finding its way into the wider economy, and that is precisely what central bankers fear.

An energy shock is unpleasant. An energy shock which becomes embedded in wages, services and business costs is considerably more troublesome. Once consumers and companies begin assuming that prices will continue rising, inflation can acquire a momentum of its own.

The ECB therefore finds itself facing the oldest monetary-policy dilemma in the book: raise interest rates and risk damaging economic growth, or hold back and risk allowing inflation to become entrenched.

It has already raised rates twice this summer. Its deposit rate currently stands at 2.5 per cent, and investors are contemplating as many as three further increases over the coming year. Yet markets are not expecting an October increase, with the next move not fully priced in until January.

That caution is understandable. Interest rates are a remarkably blunt instrument for dealing with an energy shortage. Raising the cost of borrowing cannot produce another cubic metre of natural gas or another barrel of oil. It can, however, make mortgages more expensive, discourage investment and squeeze companies already facing higher energy bills.

Europe has another problem: its public finances. Governments are under increasing pressure to cushion households and businesses from soaring energy costs. France has already seen street protests over fuel prices, while government support measures risk becoming another burden on national budgets already under considerable strain.

This creates an unpleasant feedback loop. Governments subsidise energy to protect consumers; deficits increase; bond markets demand higher yields; borrowing becomes more expensive; and households and businesses face another round of financial pressure.

France is an obvious danger point. The spread between French and German borrowing costs has risen to multi-decade highs, reflecting growing investor concern about French debt sustainability.

The ECB is consequently being asked to perform an increasingly improbable balancing act: suppress inflation without strangling growth, protect financial stability without appearing complacent, and somehow compensate for an energy shock over which it has virtually no control.

There is one reason for optimism. The underlying inflation numbers have not exploded. ECB policymaker Olli Rehn has pointed out that rising long-term interest rates themselves could restrain the transmission of higher energy prices into wages and other prices.

But that is hardly a comforting economic strategy. Europe is effectively relying on expensive money to prevent expensive energy from becoming even more expensive.

The danger is that policymakers discover they are always one crisis behind.

The eurozone’s inflation rate has already risen from 2.0 per cent at the beginning of 2026 to 3.8 per cent in September. Eurostat’s latest figures show just how rapidly the situation has changed.

If energy prices remain elevated into 2027, the ECB may have little choice but to tighten further.

Europe was promised an inflation victory. Instead, it has been handed yet another bill.