The country's holdings have increased by $5.5 billion since the start of July, according to the central bank

Russia's international reserves reached a record high of $695.5 billion at the end of July, the country's central bank reported on Thursday. More than $300 billion of that amount remain frozen by Western nations over the Ukraine conflict - an action Moscow has condemned as unlawful.

The figure marks the highest level ever recorded, surpassing the previous peak of $690 billion registered on July 4.

Russia's international reserves consist of foreign currencies, gold holdings, IMF special drawing rights, and other highly liquid assets. These funds are managed by the central bank and the government and can be deployed to stabilize the ruble, service external debt, or respond to financial crises.

Around half of Russia's international holdings - more than $300 billion - were frozen by Western nations in early 2022 following the escalation of the Ukraine conflict. The Bank of Russia has not provided a detailed breakdown of the affected assets, though it continues to include them in its official reserve figures. Russia's total reserves grew by over $100 billion from the beginning of 2023.

About two-thirds of Russia's frozen reserves are held by Brussels-based clearing house Euroclear, which have generated billions in interest. In April, the EU reported 2.1 billion ($2.3 billion) in profits from the assets. While legal and political obstacles have stalled calls for outright confiscation, EU leaders have authorized using the earnings to support Kiev.

Last year, Euroclear transferred 1.5 billion in interest income to a $50 billion G7 loan for Ukraine. The European Commission has since disbursed 7 billion from its 18.1 billion share, to be repaid using proceeds from the frozen funds.

Brussels is also considering reinvesting the assets in higher-yield instruments to increase returns.

Moscow has condemned the asset freeze, with President Vladimir Putin calling the use of Russian funds by the West "robbery" and warning of serious consequences. He said any attempt to seize the reserves would undermine global financial stability and accelerate the shift toward regional payment systems and away from Western institutions.