The Kremlin said tests on Wednesday showed the Russian president was recovering.

"The doctors have observed the start of recovery," a Kremlin spokesman told Reuters news agency. "Treatment by means of medicines will continue."

The Kremlin also said Mr Yeltsin was being allowed to walk around in his room in Moscow's elite Central Clinical Hospital and to work at a desk.

Front pages of Russian papers have been preoccupied with Mr Yeltsin's health

But Moscow Correspondent Andrew Harding says Mr Yeltsin is likely to be bedridden for several more weeks and has been told not to travel abroad for at least three months.

Mr Yeltsin was rushed to hospital on Sunday and has been treated since then with drugs to stop the bleeding.

Medical experts say any operation involving a general anaesthetic would involve some risk for the ailing Russian leader. He is still struggling to recover from heart bypass surgery and repeated bouts of pneumonia and nervous exhaustion.

IMF talks set to resume

In the meantime, talks between the Russian Government and the IMF are set to resume in Moscow.

The government has admitted it cannot afford to service all its mounting foreign debts and our correspondent says it is desperate for huge new loans from the fund to bail it out.

But IMF officials are reluctant to hand over more money to a government which they believe is not taking the right steps to sort out its financial crisis.

The two sides are likely to continue to clash over this year's budget plans, which the IMF believes are both flawed and unrealistic.

The Russians are not in a strong bargaining position, but they also know that the West will not want to sit back and let Russia sink deeper into debt and instability.