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Russia's inflation shock complicates rate cut hopes as central bank braces for slowdown
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Russia’s international reserves edged up to $722.4bn in the week ending 10 July, according to the Central Bank of Russia, extending a recovery after a sharp fall in late June. (chart)
The stockpile increased by $700mn, or about 0.1%, from $721.7bn a week earlier. It remains well below this year’s high, however, and is not a fresh record. Weekly reserves reached $826.8bn on 30 January, while the central bank’s monthly series recorded $833.6bn at the end of January.
The reserves comprise foreign currencies, monetary gold, special drawing rights and Russia’s position at the International Monetary Fund. Their dollar value can fluctuate sharply with changes in gold prices and exchange rates even when the underlying volume of assets changes little.
Russia has accumulated a large reserve cushion despite sanctions and the demands of its war in Ukraine. But the headline figure overstates the funds readily available to Moscow. Roughly $300bn of central bank assets held in western jurisdictions have remained immobilised since the full-scale invasion in 2022.
The latest increase follows a $26.9bn decline in June, when reserves fell 3.6% to $720.4bn, largely reversing gains recorded earlier in the year and underscoring the portfolio’s sensitivity to market revaluation.
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