On Monday, September 7, the ECB announced its weekly Main Refinancing Operation (MRO). This auction, which was conducted on Tuesday, attracted bids for €93.29 billion from euro area eligible counterparties.

On the same day, the Eurosystem and the Swiss National Bank (SNB) conducted a EUR/CHF foreign exchange swap, with a seven-day maturity, to provide Swiss franc liquidity against the euro. This operation attracted bids for €10.37 billion, which was less than half the intended amount of €25 billion, and all bids were allotted in full at a fixed price of -0.80 swap points.

On Tuesday, September 8, the ECB conducted a Special Term Refinancing Operation (STRO) with a maturity of 35 days, which attracted bids for €10.63 billion.

Also on September 8, being the end of the reserve deposit maintenance period, the ECB conducted an overnight Fine Tuning Operation to absorb excess liquidity from the market. This was carried out at a variable rate, with a maximum of one per cent, and attracted bids for €196.30 billion, of which the ECB accepted €195.10 billion, or 99.39 per cent of the total amount bid for. The marginal rate on the operation was set at 0.80 per cent, while the average weighted rate was 0.73 per cent.

On Wednesday, September 9, the ECB, in conjunction with the US Federal Reserve, conducted a seven-day US dollar funding operation through collateralised lending. This attracted bids for $41.58 billion, which amount was allotted in full at a fixed rate of 1.17 per cent.

On the same day, the Eurosystem, in conjunction with the US Federal Reserve, conducted another US dollar funding operation, this time with a tenor of 84 days and at a fixed rate of 1.19 per cent; but this attracted no bids from eligible counterparties.

Also on Wednesday, September 9, the ECB conducted two supplementary Longer-Term Refinancing Operations (LTROs), one with a maturity of 91 days and the other with a maturity of 182 days. These operations received bids for €3.16 billion and €3.69 billion, respectively.

The amounts bid for in all the ECB's euro refinancing operations were allotted in full at a fixed rate equivalent to the prevailing refinancing rate of one per cent, in accordance with the ECB's current policy.

In the domestic primary market for Treasury Bills, the Treasury invited tenders for 91-day bills maturing on December 11. Bids for €33.50 million were submitted, with the Treasury allotting €31.50 million. Since €49.19 million worth of bills matured during the week, the outstanding balance of Treasury Bills decreased by €17.69 million to €560.16 million.

The yield resulting from the auction was 1.457 per cent, i.e. 0.7 basis points higher than that on bills with a similar tenor issued on September 4. The latest yield represented a bid price of 99.6331 per 100 nominal.

Today the Treasury will invite tenders for 181-day bills maturing on March 18, 2010.

Treasury Bill trading on the Malta Stock Exchange amounted to €2.34 million during the week, with €1.42 million trades being conducted by the Central Bank of Malta in its role as market maker and €0.92 million being conducted by other brokers.

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