The suggestion by some commentators that the new lending facility unveiled by the Central Bank of Russia last week amounts to a form of quantitative easing seems wide of the mark. All the signs so far are that lending under the new facility will simply replace other forms of liquidity provision. Looser collateral requirements should make it easier for weaker banks to access finance. But there is no indication that the overall size of the monetary base will increase as a result, and we doubt that this will amount to a significant loosening of monetary conditions.
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