**RUSSIAN ECONOMICAND FINANCIAL DEVELOPMENTS**

**FOR WEEK ENDINGOCTOBER 22, 1999**

27 OCT 99

SOURCE: US EMBASSYMOSCOW

---------------------------

FINANCIAL MARKETINDICATORS

---------------------------

1. FINANCIAL MARKETTRENDS

NO NEW NEWS WAS GOODNEWS FOR RUSSIAN FINANCIAL MARKETS

THIS WEEK. CONTINUEDSPECULATION REGARDING PRIME

MINISTER PUTIN'SFUTURE, THE WAR IN CHECHNYA, AND IMF

FUNDING, AND EVENANOTHER DUMA DELAY IN VOTING ON THE

2000 BUDGET, FAILEDTO DRAG MARKETS DOWN. THE RTS INDEX

WAS UP BY 3.2 PERCENTIN REAL TERMS, ALTHOUGH ON VERY

LOW VOLUME.  THE RUBLE GAINED SLIGHTLY AGAINST THE

DOLLAR. RUBLEINTERBANK SHORT-TERM LOAN MARKET RATES

REMAINED ATRELATIVELY LOW LEVELS THROUGHOUT THE WEEK.

INTERNATIONALRESERVES INCREASED FURTHER THIS WEEK, BY

AN ADDITIONAL USDLO0MILLION OR 0.86 PERCENT, TO

USD11.7BILLION.  THE MONETARY BASE ROSEAGAIN THIS

WEEK, BY R5.5BILLION OR 2.1 PERCENT.

---------------------------------------------

2. ECONOMIC ANDFINANCIAL MARKET DEVELOPMENTS

---------------------------------------------

-- ACCORDING TO THELABOR MINISTER SERGEY KALASHNIKOV,

WAGE ARREARS IN THERUSSIAN FEDERATION HAVE DROPPED BY

4O PERCENT SINCEOCTOBER 1998 AND CURRENTLY TOTAL R54.6

BILLION.

-- ACCORDING TO THEFINANCE MINISTER MIKHAIL KASYANOV,

THE SHORTFALL IN GOREXTERNAL FINANCING IS CURRENTLY

USD1 BILLION,INCLUDING USD640 MILLION EXPECTED FROM

THE SECOND IMFTRANCHE AND USD350 MILLION FROM THE

WORLD BANK AND THEJAPANESE GOVERNMENT.

-- TAX POLICEDIRECTOR VYACHESLAV SOLTAGANOV ANNOUNCED

THAT THE TAX POLICEINITIATED 11,000 CRIMINAL CASES

DURING THE FIRST 9MONTHS OF 1999, 2.5 TIMES MORE THAN

DURING THE SAMEPERIOD LAST YEAR.

-- ACCORDING TO TAXMINISTER POCHINOK, THE TAX MINISTRY

WILL COLLECT R31-32BILLION OF TAXES IN OCTOBER.  IN

SEPTEMBER TAXMINISTRY COLLECTED R3O.4 BILLION. THIS

YEAR, THE TAXMINISTRY IS COLLECTING ABOUT 2 PERCENT OF

GDP MORE IN TAXESTHAN IN 1998. POCHINOK SAID THE TAX

BURDEN IS INCREASINGIN ABSOLUTE TERMS.  EXCISE TAXES

ON ALCOHOLICBEVERAGES, OIL, AND MOTOR FUEL WILL BE

INCREASED BY 30PERCENT NEXT YEAR AND EXCISE TAXES ON

TOBACCO WILL BEDOUBLED. THE MINISTRY CONTINUES TO

INSIST THATRESTRICTIONS BE IMPOSED ON THE NUMBER OF

ACCOUNTS A SINGLEENTERPRISE CAN OPEN.

-- ACCORDING TO THERUSSIAN STATISTICAL AGENCY, THE

UNEMPLOYMENT RATE INSEPTEMBER WAS 12.4 PERCENT, OR

9.12 MILLION PEOPLE,UNCHANGED FROM AUGUST.  THE

AVERAGE SUBSISTENCELEVEL IN SEPTEMBER WAS DOWN BY R16

TO R920 (USD 36.22).

-- ACCORDING TODEPUTY MINISTER OF THE ECONOMY KOSSOV,

TOTAL FOREIGN DIRECTINVESTMENT IN RUSSIA IN 1999 WILL

TOTAL R600 BILLION,A DECREASE OF 4O PERCENT FROM 1998.

HE PROJECTED FDIWILL GROW BY 1 PERCENT IN 2O00.

--------------

3.  BANK ALERT

--------------

-- THE CENTRAL BANKOF RUSSIA (CBR) REPORTED RUSSIA'S

GOLD AND CURRENCYRESERVES AT US011.7 BILLION ON

OCTOBER 15, ANINCREASE OF USD 0.1 BILLION FROM A WEEK

EARLIER.  THIS FIGURE INCLUDES USD4.4 BILLION INGOLD

AND US0289.5 MILLIONIN ASSETS HELD BY THE CBR IN ITS

FOREIGNSUBSIDIARIES.

-- THE CBR SAID THATTHE NUMBER OF FUNCTIONING CREDIT

INSTITUTIONS SHRANKIN THE LAST 12 MONTHS FROM 1573 TO

1389. THE BANKSWHICH LOST THEIR LICENSES ACCOUNTED FOR

25 PERCENT OF THEAGGREGATE ASSETS OF THE RUSSIAN

BANKING SYSTEM(EXCLUDING SBERBANK OF RUSSIA) PRIOR TO

THE AUGUST 1998CRISIS.

-- THE COMMISSIONORGANIZING THE AUDIT OF THE CBR HAS

RECOMMENCED TWOCOMPANIES TO THE STATE DUMA, PRICE

WATERHOUSE COOPERS(PWC) AND UNICON.  PWC WOULDCONDUCT

THE REGULAR AUDITWHILE UNICOM WOULD EVALUATE THE CBR'S

MONETARYPOLICY.  HOWEVER, THE CBR OPPOSES BEING

AUDITED BY TWOCOMPANIES AT ONCE.

-- MORE THAN R15BILLION IN TAXES ARE TRAPPED IN

TROUBLED OR DEFUNCTRUSSIAN BANKS, TAX MINISTER

ALEXANDER POCHINOKSAID IN A NEWSPAPER INTERVIEW.

ABOUT R5 BILLIONRUBLES OF THIS WAS "DEAD MONEY" USED

TO AVOID TAXES.HOWEVER, RUSSIAN LAW PREVENTS THE

MINISTRY OF TAXESFROM WORKING WITH TROUBLED BANKS.

-- ALEXANDERTRUBANOV, GENERAL DIRECTOR OF THE AGENCY

FOR RESTRUCTURINGCREDIT ORGANIZATIONS (ARKO), SAID

ARKO IS CONSIDERINGTHREE OPTIONS FOR THE FUTURE OF THE

SBS-AGRO BANKINGGROUP.  THE FIRST OPTION IS SIMPLYTO

REVOKE ITS BANKLICENSE WITHOUT RESTRUCTURING.  THE

SECOND WOULD INVOLVETHE FORMATION OF A RUSSIAN

AGRICULTURAL BANKUSING SBS-AGRO BRANCHES AND WITH THE

PARTICIPATION OF ITSSHAREHOLDERS.  UNDER THE THIRD

OPTION, A RUSSIANAGRICULTURAL BANK WOULD BE FORMED

WITHOUT THEPARTICIPATION OF SBS-AGRO SHAREHOLDERS. THE

FIRST OPTION WOULDNOT REQUIRE ANY STATE SPENDING. THE

SECOND OPTION WOULDCOST R16.4 BILLION, HALF IN CASH

AND HALF INSECURITIES.  THE THIRD SCHEME WOULDCOST R7

BILLION.  AN ARKO BOARD DECISION ON WHICH OPTIONTO

FOLLOW HAS BEENDELAYED FROM OCTOBER 18 UNTIL DECEMBER

27.

--VNESHECONOMBANK(VEB) WILL REORGANIZE AND BECOME A

MAJOR FINANCIAL ANDINVESTMENT INSTITUTION NEXT YEAR,

CHAIRMAN ANDREIKOSTIN SAID AT A PRESS CONFERENCE AFTER

BEING REAPPOINTED BYPRESIDENT YELTSIN FOR ANOTHER

THREE-YEARTERM.  VEB IS THE GOVERNMENT'S MAINPAYMENT

AGENT ON SOVIET ERADEBT. IT HAS DRAFTED AND SUBMITTED

TO THE WORLD BANK AMID-TERM PROGRAM TO TURN VEB INTO A

FINANCIAL ANDINVESTMENT INSTITUTION.  KOSTINSAID THE

BANK IS COUNTING ONEXPERTISE AND ASSISTANCE FROM THE

WORLD BANK AND THEEUROPEAN BANK FOR RECONSTRUCTION AND

DEVELOPMENT TOCREATE A UNIFIED SYSTEM FOR MANAGING THE

FOREIGN DEBT. WHENASKED ABOUT THE EFFECT OF A DEFAULT

ON THE SOVIET ERADEBT ON VEB'S PLANS, KOSTIN SAID THE

DEBT PROBLEM WILL BESETTLED IN ANY EVENT.  VEB COULD

REACH AGREEMENT WITHTHE LONDON CLUB EITHER ON A DEBT

RESTRUCTURINGAGREEMENT OR A PARTIAL WRITE-OFF. KOSTIN

SAID THAT THE GORAPPROVES OF THE IDEA OF CHANGING THE

BANK'S STATUS.

-- NEXT WEEK, THERUSSIAN TRADING SYSTEM (RTS) WILL

START TRADINGINTERBANK LOANS.  INITIALLY, THERTS WILL

NOT COVER RISKS ORGUARANTEE DEALS.

---------

4. PRICES

---------

ACCORDING TO THERUSSIAN STATISTICAL AGENCY, INFLATION

FOR THE FIRST 11DAYS OF OCTOBER TOTALED 0.5 PERCENT.

FOR THE PERIODOCT.05-11 PRICES GREW BY 0.3 PERCENT.

AVERAGE DAILYINFLATION IN OCTOBER DECREASED TO 0.043

PERCENT, COMPAREDWITH 0.049 IN SEPTEMBER, WHEN THE

INFLATION RATE REACHED1.5 PERCENT.

------------------------------

5.    FINANCIAL MARKET TABLES

------------------------------

-----------------------------------------

A. THE RUBLE FIRMS ALITTLE OVER THE WEEK

-----------------------------------------

FOR MOST OF THE WEEK,THE SUPPLY OF DOLLARS AT THE MICEX

EXCEEDEDDEMAND.  THE ONLY EXCEPTION WASDURING THE

WEDNESDAY MORNINGSESSION, WHEN DEMAND FOR DOLLARS

EXCEEDED SUPPLY BYMERE USD5 MILLION, AND EVEN THEN, THE

RUBLE FIRMEDSLIGHTLY.  THE CBR WAS NOT VERYACTIVE IN

THE FOREX MARKETTHIS WEEK, ONLY OCCASIONALLY BUYING

DOLLARS IN THEMORNING SESSIONS.  THE SUPPLY OFDOLLARS

INCREASED BECAUSECOMPANIES ARE PREPARING TO MAKE TAX

PAYMENTS DUE A THEEND OF THE MONTH.  FOR THE WEEK,

FRIDAY TO FRIDAY,THE "TOD" RUBLE FIRMED 0.15 PERCENT

AGAINST THEDOLLAR.  AVERAGE DAILY TURNOVER FOR"TOD"

SETTLEMENTS WENT UPFROM USD13O.4 MILLION TO USD147.9

MILLION, WHILE THEAVERAGE TURNOVER FOR "TOMS" WENT UP

FROM USD47.1 MILLIONTO USD58.1 MILLION.  FOREX DEALERS

EXPECT THE RUBLE TOWEAKEN IMMEDIATELY AFTER THE "END-OF-

MONTH" DEMANDCYCLE SUBSIDES.  MEANWHILE, CBRCHAIRMAN

GERASHCHENKO SAIDTHAT THE EXCHANGE RATE AT THE END OF

1999 WOULD BE R26 TOR27 PER USD.

TABLE 1A:  RUBLE RATES -- MICEX SELT TRADING (NOTE1)

 ------------------------------------------------

           USD-TOD   USD-TOD   USD-TOM  USD-TOM

   DATE    AVERAGE   VOLUME  AVERAGE   VOLUME

            PRICE   (USD MN)   PRICE   (USD MN)

 ------------------------------------------------

 10/18/99  25.8756     157.20  25.8714   68.6O

 10/19/99  25.8275     135.02  25.8376   69.9O

 10/2O/99  25.8335     137.82  25.8455   50.7O

 10/21/99  25.7855     132.79  25.7853   58.7O

 10/22/99  25.7625     176.59  25.7476   42.80

TABLE 1B:  RUBLE RATES -- CASH RATES AT EXCHANGEPOINTS

(RUBLES PER USD)(NOTE 2)

-------------------------------------------------

                   PRCT CHNG           PRCTCHNG

   DATE    AVERAGE   AGAINST  AVERAGE   AGAINST

             BUY    WEEKAGO    SELL    WEEK AGO

-------------------------------------------------

 10/18/99    25.7-5        0.66   25.98       0.46

 10/19/99    25.76         0.43   25.94       0.31

 10/2O/99    25.76         0.35   25.94       0.43

 10/21/99    25.74         0.47   25.93       0.35

 10/22/99    25.70         0.O4  25.90     -0.15

TABLE IC:  RUBLE RATES-- CBR OFFICIAL EXCHANGERATE

-----------------------------------------

                    PRCT CHNG  PRCT CHNG

   DATE    OFFICIAL   AGAINST    AGAINST

            RATE     WEEKAGO   09/08/98

 -----------------------------------------

 10/18/99  25.8000        0.16      51.85

 10/19/99  25.8800        0.47      52.32

 10/20/99  25.8300        0.35      52.03

 10/21/99  25.8300        0.51      52.03

 10/22/99  25.7900        0.47      51.80

---------------------

B. OFZ MARKET

---------------------

SECONDARY OFZ PRICESFELL FOR THE THIRD WEEK IN A ROW.

CURRENT YIELDS ARENOT ATTRACTIVE TO MARKET PLAYERS

OESPITE HIGH RUBLELIQUIDITY.  DEALERS PREFER TO STAY

IN "CASH"RATHER THEN BUY OFZ'S, GIVEN THE RELATIVELY

STABLE RUB/USDEXCHANGE RATE.  ON TUESDAY, YIELDSFELL

TO THE LEVELS OFJUNE 1999.  THE YIELD ON THESHORTEST

TERM OFZ ISSUE(NUMBER 022) INCREASED TO 74.5 PERCENT

P.A. AND LONGER-TERMISSUE YIELDS WERE UP TO 91.02

PERCENT P.A. (ISSUENUMBER 27001).  LATER IN THE WEEK,

PRICES FOR ISSUENUMBER 022 BEGAN TO INCREASE AND THE

YIELD FELL TO 66.5PERCENT P.A. ON FRIDAY, LEAVING IT

PRACTICALLYUNCHANGED FOR THE WEEK.  LONG-TERMOFZ

ISSUES FELL IN PRICEAGAIN AND THEIR YIELDS INCREASED

TO CLOSE AT 92PERCENT P.A. AT THE FRIDAY CLOSE. TRADE

VOLUME WAS LOWTHROUGHOUT THE WEEK.

------------------------------

TABLE 3A: OFZSECONDARY MARKET

------------------------------

         11.18.99  12.19.99  13.20.99  14.21.99 15.22.99

 TOTAL

 TRADE      N/A       N/A       N/A       N/A       N/A

 VOLUME

(MLN RUB)

 ---------------------------------

C. SHORT-TERMINTERBANK DOWN AGAIN

----------------------------------

THE SHORT-INTERBANKRUBLE LOAN MARKET WAS QUIET AGAIN

THIS WEEK BECAUSERUBLE LIQUIDITY WAS QUITE HIGH.

RATES WERERELATIVELY LOW AND STABLE. THE BALANCES ON

BANKS' CORRESPONDENTACCOUNTS IN THE CBR STAYED AT THE

SAME LEVEL AS THEWEEK BEFORE, REACHING MAXIMUM OF

R55.6 BILLION ONWEDNESDAY AND THEN DROPPING DOWN TO

R52 BILLION AT THEEND OF THE WEEK.

--------------------------

TABLE 4: INTERBANKCREDIT

--------------------------

 DATE                     PERIOD (IN DAYS)

-----------------------------------------------------

                   1     7     14     30     60     90

-----------------------------------------------------

 OCT 18   MIBID  11.4   13.0   15.0   20.0  23.0  25.0

          MIBOR   17.8   23.0  25.0   30.0   35.0  40.0

 OCT 19   MIBID  07.2   10.0   13.0   20.0  23.0  25.0

          MIBOR   13.0   20.0  23.0   30.0   35.0  40.0

 OCT 20   MIBID  08.6   10.0   13.0   19.0  23.0  25.0

          MIBOR   14.6   20.0  25.0   30.0   35.0  40.0

 OCT 21   MIBID  09.4   11.0   14.0   20.0  23.0  25.0

          MIBOR   15.8   22.0  25.0   30.0   35.0  40.0

 OCT 22   MIBIO  08.6   12.0   15.0   20.0  23.0  25.0

          MIBOR   15.2   25.0  27.0   30.0   35.0  40.0

------------------------

D. STOCK MARKET UPAGAIN

------------------------

THE STOCK MARKET WASGENERALLY UP THIS WEEK. IN THE

FIRST PART OF THEWEEK, NON-RESIDENTS STAYED ON

SIDELINES. HOWEVER,BY THE END OF THE WEEK, NON-

RESIDENTS,APPARENTLY INSPIRED BY THE POSITIVE MOOD IN

THE U.S. MARKET,STARTED TO MAKE TINY PURCHASES WHICH

PUSHED THE STOCKPRICES UP A BIT IN THE ABSENCE OF

SELLERS.  FOR THE WEEK, THE RTS INDEX GAINED 3.26

PERCENT IN REALTERMS. TRADING VOLUME WAS LOW THROUGHOUT

THE WEEK, DROPPINGDOWN AS LOW AS USD4.1 MILLION ON

FRIDAY.

--------------------------

TABLE 5: RTS STOCKINDICES

--------------------------

                                              DOLLAR

 DATE    RTS INDEX        PERCENT CHANGE      ADJUSTED

          (R)      NOMINAL (RUB) REAL (USD)

 OCT 18  546.46         -0.46       -0.96      94.19

 OCT 19  561.36          2.73       2.41     96.46

 OCT 2O  571.48          1.80        2.00      98.39

 OCT 21  556.75         -2.58       -2.64      95.85

 OCT 22  569.52          2.29       2.45     98.20

-------------------------

E. INTERNATIONALRESERVES

-------------------------

INTERNATIONALRESERVES OF THE CENTRAL BANK AND THE

FINANCE MINISTRYINCREASED SLIGHTLY THIS WEEK, BY

USD100 MILLION,REACHING USD11.7 BILLION.

ACCORDING TO THECBR'S OFFICIAL PRESS RELEASE, GOR

INTERNATIONALRESERVES INCLUDE USD289.5 MILLION LOCATED

IN THE CBR'SOVERSEAS SUBSIDIARIES.

-----------------------------------------

TABLE 6:INTERNATIONAL RESERVES (NOTE 5)

-----------------------------------------

INTERNATIONAL  BLN USD  PERCENT CHG PERCENT CHG

RESERVES                 PREV WK     01.01.99

10.15.99        11.7      0.9        -04.1

10.08.99        11.6      3.6        -04.9

10.01.99        11.2      2.8        -08.2

09.24.99        10.9      0.0        -10.7

09.17.99        10.9      0.0        -10.7

----------------

F. MONETARY BASE

----------------

THE MONETARY BASEINCREASED AGAIN THIS WEEK BY 2.1

PERCENT, OR R5.5BILLION, AND TOTALED R272 BILLION.

--------------------------------

TABLE 7: MONETARYBASE (NOTE 6)

--------------------------------

MONETARY   BLN RUBLES    PRCT CHNG FROM       PRCT CHNGFROM

BASE                       PREV.WEEK       PREV. 4 WK AVG

10.18.99     272.0           2.06                 3.5

10.11.99     266.5           2.89                 1.4

10.04.99     259.0           -1.00                -1.8

09.27.99     261.6           -1.13                 -1.0

09.20.99     264.6           -0.56                -0.1

--------------------------

G. CORRESPONDENTACCOUNTS

--------------------------

-------------------------------------------

TABLE 9: BALANCES ONCORRESPONDENT ACCOUNTS

-------------------------------------------

       DATE                BALANCE (BLN RUB)

      10.18.99                    52.869

      10.19.99                    53.357

      10.20.99                    55.593

      10.21.99                    52.429

      10.22.99                     52.768

-----------------------

H. RESERVEREQUIREMENTS

-----------------------

BANK RESERVESREQUIREMENTS HAVE REMAIN UNCHANGED SINCE JUNE 10

1999.

-----------------------------

TABLE 8: RESERVEREQUIREMENTS

-----------------------------

PERIOD       RESERVE RATE ON      RESERVE RATE ON

             ATTRACTED FUNDS OF  ATTRACTED FUNDS OF

             CORPORATE CLIENTS   PRIVATE INDIVIDUALS

             IN RUBLES AND ON    IN RUBLES (PERCENT)

             ATTRACTED FUNDS OF

              CORPORATECLIENTS

             AND PRIVATE

             INDIVIDUALS IN

             FOREIGN CURRENCY

             (PERCENT)

12.01.98-                    5

03.19.99-            7.0                   5

             (UP BY 2 PERCENT)

06.10.99-            8.5                 5.5

             (UP BY 1.5 PERCENT)  (UP BY0.5 PERCENT)

------------------

EXPLANATORY NOTES

------------------

1. EXCHANGE RATES:SELT - "SYSTEM OF ELECTRONIC LOT

(CURRENCY)TRADING" - A COMPUTER-BASED OTC-TYPE TRADING

SYSTEM ORGANIZED BYTHE MOSCOW INTERBANK CURRENCY

EXCHANGE(MICEX).  USO-TOD PRICE IS THEPRICE OF THE

DOLLAR WITH THE SAMEDAY DELIVERY.  USD-TOM PRICE IS

THE PRICE OF THEDOLLAR WITH DELIVERY ON THE NEXT DAY.

MINIMUM LOT SIZE FOREACH OF THE DOLLAR INSTRUMENTS IS

USD100,000.  AVERAGE PRICE IS QUOTED AS THE WEIGHTED

AVERAGE OF ALL THEBIDS AND OFFERS ENTERED INTO THE

SYSTEM BY VARIOUSBANKS.

2. AVERAGE CASHRATES ARE QUOTED AS CALCULATED BY THE

INTER-LINEINFORMATION AGENCY THAT PROCESSES DATA FROM

OVER 50O EXCHANGEPOINTS IN THE CITY OF MOSCOW.

3. INTEREST RATES:THE TABLE PROVIDES MOSCOW INTERBANK

BID (MIBID) ANDMOSCOW INTERBANK OFFERED RATE (MIBOR)

B ANNUALIZED AVERAGE BID AND OFFER RATES ONSHORT-TERM

RUBLE LOANS BETWEENCOMMERCIAL BANKS.

4. STOCK INDICES:THE RTS INDEX, IS THE ONLY OFFICIAL

INDICATOR OF THERUSSIAN TRADING SYSTEM.  IT IS

CALCULATED EVERY 3OMINUTES OF THE RTS TRADE SESSION,

STARTING FROM12:O0.  IT COMPRISES 60 SHARES OF35

LEADINGCOMPANIES.  THIS SHARES AREINCLUDED IN SO-

CALLED CATEGORY"A" LISTING.  THE INDEXINDICATES OVER-

THE-COUNTER STOCKPRICES.  THE INDEX REPRESENTS THE

RATIO OF THE TOTALMARKET CAPITALIZATION OF THE SHARES

OF THE COMPANIESSELECTED FOR THE INDEX TO THE TOTAL

MARKETCAPITALIZATION OF THE SAME SHARES AS OF THE

INITIAL DATEMULTIPLIED BY THE INDEX VALUE AS OF THE

INITIAL DATE (31DECEMBER, 1997) USING A BASE OF 100

BEGINNING SEPTEMBER1, 1995.  THE RUBLE-ADJUSTED INDEX

IS A DERIVATIVE OFTHE MAIN DOLLAR INDEX, USING THE

SAME BASE.

5. INTERNATIONALRESERVES OF THE RUSSIAN FEDERATION

REPRESENT THE AMOUNTOF RESERVE ASSETS OF THE BANK OF

RUSSIA AND FINANCEMINISTRY.  THOSE RESERVE ASSETS ARE

COMPRISED OFMONETARY GOLD, SPECIAL DRAWING RIGHTS, THE

RESERVE POSITION INTHE IMF AND OTHER LIQUID FOREIGN

CURRENCYASSETS.  THE LATTER INCLUDE SHORT-TERM

DEPOSITS INNONRESIDENT AND RESIDENT BANKS, BALANCES IN

CURRENT ACCOUNTS,FOREIGN GOVERNMENT SECURITIES, REPO

AGREEMENTS WITHTHESE SECURITIES MADE WITH

NONRESIDENTS, ANDOTHER LIQUID ASSETS (ACCRUED INTEREST

ON THESE ASSETS ISNOT INCLUDED).  MONETARY GOLD IS

EVALUATED AT USD30OPER TROY OZ.  FOREIGN CURRENCY

ASSETS ARE CONVERTEDINTO US DOLLARS ON THE BASIS OF

THE CROSS RATES OFFOREIGN CURRENCIES TO THE USD,

CALCULATED USING THEOFFICIAL RATES OF THE RUBLE TO

THESE FOREIGNCURRENCIES, SET BY THE CBR.

6. MONETARY BASE(ML) IS COMPRISED OF CASH AND RESERVES

OF COMMERCIAL BANKSON DEPOSIT IN THE CBR.  IT IS THE

BASIC PART OF THEMONEY SUPPLY (M2).

7. LOMBARD CREDITS,DISTRIBUTED THROUGH AUCTIONS, ARE

AIMED TO PROVIDE THELIQUIDITY TO THE BANKING SECTOR.

THESE CREDITS AREEXTENDED TO BANKS ON THE BASIS OF

COLLATERAL (T-BILLS,OR MORE RECENTLY, SHARES).