The reason for this strange behavior lies in the dependency of Russia's gold industry on central bank purchases. Last year, according to the Moscow-based Gold Mining Union, Russia became the world's second-biggest producer of the precious metal, extracting 288 tons. Producers are not allowed to export their output directly. Instead, they have to sell it to banks, which are authorized to deal with foreign buyers and the Russian central bank. Last year, European banks bought 76 tons they have long-standing trading arrangements with state-owned Russian banks, the biggest buyers on the domestic market but the central bank dwarfed that, snapping up 59 percent of all output.