On Thursday, April 17, the European Central Bank (ECB) announced its weekly main refinancing operation (MRO). The auction was conducted on Tuesday, April 22, and attracted bids from euro area eligible counterparties of €121.82 billion, €9.65 billion higher than the bid amount of the previous week. The amount was allotted in full at a fixed rate equivalent to the prevailing MRO rate of 0.25 per cent, in accordance with current ECB policy.
Also on Tuesday, April 22, the ECB conducted an auction for a seven-day fixed-term deposit intended to absorb €172.50 billion. This operation was designed to sterilise the effect of purchases made under the Securities Markets Programme that were settled but had not yet matured by the previous Friday, April 18. The auction was carried out at a variable rate, with euro area eligible counterparties allowed to place up to four bids at a maximum rate of 0.25 per cent. It attracted bids amounting to €166.78 billion, with the ECB allotting the full amount. The marginal rate on the auction was set at 0.25 per cent, with the weighted average rate at 0.23 per cent.
On Wednesday, April 23, the ECB conducted an eight-day US dollar funding operation through collateralised lending in conjunction with the US Federal Reserve. This operation was carried out at a fixed rate of 0.59 per cent and once again did not attract bids from euro area eligible counterparties.
Furthermore, on Wednesday, April 23, the ECB, in conjunction with the US Federal Reserve, conducted an 84-day US dollar funding operation through collateralised lending. This attracted bids of $0.12 billion, which was allotted in full at a fixed rate of 0.59 per cent.
Domestic Treasury bill market
In the domestic primary market for Treasury bills, the Treasury invited tenders for 91-day and 182-day bills maturing on July 25 and October 24, respectively. Bids of €22.50 million were submitted for the 91-day bills, with the Treasury accepting €10.50 million, while bids of €42 million were submitted for the 182-day bills, with the Treasury accepting €17 million. Since €29 million worth of bills matured during the week, the outstanding balance of Treasury bills decreased by €1.50 million, to stand at €371.45 million.
The yield from the 91-day bill auction was 0.370 per cent, i.e. 0.80 basis points higher than on bills with a similar tenor issued on April 17, representing a bid price of 99.9066 per 100 nominal. The yield from the 182-day bill auction was 0.656 per cent, i.e. 1.0 basis point lower than on bills with a similar tenor issued on April 17, representing a bid price of 99.6695 per 100 nominal.
During the week, the Central Bank of Malta, in its role as market-maker, purchased €0.60 million worth of Treasury bills on the Malta Stock Exchange.
Today the Treasury will invite tenders for 91-day and 182-day bills maturing on August 1 and October 31, respectively.