Russia’s gross international reserves (GIR) topped $557.5bn on January 10, according to the Central Bank of Russia (CBR), surpassing the previous all-time high recorded in 2008.

Russia’s reserves have been rising steadily since the crisis of 2014 began with the collapse of oil prices and a subsequent deep devaluation of the ruble.

The CBR had been following an informal policy to build up reserves to its “comfort level” of $500bn and passed that milestone for the first time in five years in June.

At the same time the CBR has slowed the pace of its accumulation of gold. The central bank has run a policy of building up gold as a share of its reserves since 2007, but it clearly has reached a point where this comfort level has also been reached.

After spending an estimated $40bn on the precious metal in the past five years, the central bank is starting to rein in spending – it bought 149 tonnes of gold in the first 11 months of 2019, 44% less than the year before. Annual purchases are expected to be the lowest in six years.

And finally the CBR has returned to the US debt market after selling off much of its holding in US treasury bills last spring. With excess reserves the CBR has been looking for investments.

Russian holdings of US debt increased by $794mn in November 2019 to $11.491bn, including $8.512bn worth of short-term securities and $2.979bn worth of long-term securities, according to the data provided by the US Department of the Treasury as cited by Tass.

As a result of the build-up of this cash pile Russia can now cover its external debt dollar for dollar in cash. In 2019, Russia's total foreign debt increased by 5.9% to reach $481.5bn. However, in the same period, foreign reserves jumped from $468bn to $554bn, a rise of 18%.

“Russia’s international reserves-to-total external debt ratio rises to 115% by end 2019 and is expected to grow further on continued FX buying under fiscal rule,” tweeted Ivan Tkachev, the economics editor at RBC. “Among major emerging economies Russia is second only to China under this metric.”