On September 7, the Governing Council of the European Central Bank decided that the interest rate on the main refinancing operations (MRO) and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.0 per cent, 0.25 per cent and -0.40 per cent, respectively. The Governing Council expects the key ECB interest rates to remain at their present levels for an extended period of time and well past the horizon of the net asset purchases.
Regarding non-standard monetary policy measures, the Governing Council confirms that the net asset purchases, at the current monthly pace of €60 billion, are intended to run until the end of December, or beyond, if necessary, and in any case until the Governing Council sees a sustained adjustment in the path of inflation consistent with its inflation aim.
The net purchases are made alongside reinvestments of the principal payments from maturing securities purchased under the asset purchase programme. If the outlook becomes less favourable, or if financial conditions become inconsistent with further progress towards a sustained adjustment in the path of inflation, the Governing Council stands ready to increase the programme in terms of size and/or duration.
ECB monetary operations
On September 4, the ECB announced its weekly MRO. The operation was conducted on September 5 and attracted bids from euro area eligible counterparties of €4.31 billion, €1.60 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 zero per cent, in accordance with current ECB policy.
On September 6, the ECB conducted a seven-day US dollar funding operation through collateralised lending in conjunction with the US Federal Reserve. This operation attracted bids of $0.09 billion, which was allotted in full at a fixed rate of 1.66 per cent.
Domestic Treasury bill market
In the domestic primary market for Treasury bills, no auction was held by the Treasury. Since €12 million worth of bills matured during the week, the outstanding balance of Treasury bills now stands at €144.40 million.
During the week under review, there was no trading on the Malta Stock Exchange.
This week there will be no auctions for Treasury bills.