Small increase in three-month Treasury Bill rate
On July 19, the ECB announced its weekly MRO. The auction was conducted a day later on July 20, and attracted bids from euro area eligible counterparties of €201.29 billion, €5.63 billion more than the amount bid for the previous week. The bid amount...
On July 19, the ECB announced its weekly MRO. The auction was conducted a day later on July 20, and attracted bids from euro area eligible counterparties of €201.29 billion, €5.63 billion more than the amount bid for the previous week. The bid amount was allotted in full at a fixed rate equivalent to the prevailing main refinancing rate of one per cent, in accordance with current ECB policy.
On July 20, the ECB also conducted an auction for a seven-day, fixed-term deposit intended to absorb €60 billion. The operation was designed to sterilise the effect of purchases made under the Securities Market Programme and settled by July 16. The auction was carried out at a variable rate, with euro area eligible counterparties allowed to place up to two bids at a maximum rate of one per cent. It attracted bids amounting to €97.17 billion. The ECB allotted the intended volume of €60 billion, or 61.75 per cent of the total amount bid for. The marginal rate on the auction was set at 0.64 per cent, with the weighted average rate standing at 0.56 per cent.
On July 21, the ECB conducted a seven-day US dollar funding operation through collateralised lending in conjunction with the US Federal Reserve. The rate for the operation was fixed at 1.19 per cent, but it did not attract any bids.
Meanwhile, in the domestic primary market for Treasury Bills, the Treasury invited tenders for 91-day bills maturing on October 22. Bids of €92.92 million were submitted, with the Treasury accepting just €1.92 million. Since €9 million worth of bills matured during the week, the outstanding balance of Treasury Bills decreased by €7.08 million, to stand at €581.52 million.
The yield from the 91-day bill auction was 0.749 per cent, i.e. 1.4 basis points higher than on bills with a similar tenor issued on July 9. The yield on these bills represented a bid price of 99.8110 per 100 nominal.
During the week, Treasury Bill trading on the Malta Stock Exchange amounted to €4.1 million, with all trading conducted by the Central Bank of Malta in its role as market maker.
Today, the Treasury will invite tenders for 91-day bills maturing on October 29.