On Thursday, June 2, the Governing Council of the European Central Bank (ECB) decided that the interest rate on the main refinancing operations (MRO), the marginal lending facility and the deposit facility will remain unchanged at 0.00 per cent, 0.25 per cent and - 0.40 per cent, respectively.
Regarding non-standard monetary policy measures, on Wednesday the Eurosystem will start making purchases under its corporate sector purchase programme (CSPP). Moreover, starting on Wednesday, June 22, it will conduct the first operation in its new series of targeted longer-term refinancing operations (TLTRO II).
ECB monetary operations
On Monday, May 30, the ECB announced its weekly MRO. The operation was conducted on Tuesday, May 31, and attracted bids from euro area eligible counterparties of €51.91 billion, €8.30 billion lower 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 0.00 per cent, in accordance with current ECB policy.
On Wednesday, June 1, the ECB conducted a seven-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 0.87 per cent and did not attract bids from euro area eligible counterparties.
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 September 1 and December 1, 2016. Bids of €70 million were submitted for the 91-day bills, with the Treasury accepting €13 million, while bids of €45 million were submitted for the 182-day bills, with the Treasury accepting €2 million. Since €17 million worth of bills matured during the week, the outstanding balance of Treasury bills decreased by €2 million, to stand at €336 million.
The yield from the 91-day bill auction was -0.235 per cent, down by 2.0 basis points from bids with a similar tenor issued on May 26, representing a bid price of 100.0594 per 100 nominal. The yield from the 182-day bill auction was also -0.235 per cent, down by 2.5 basis points from bids with a similar tenor also issued on May 26, representing a bid price of 100.1189 per 100 nominal.
During the week under review, there was no trading on the Malta Stock Exchange.
Yesterday, the Treasury invited tenders for 90-day and 181-day bills maturing on September 7 and December 7, respectively.