On Monday, March 19, the ECB announced its weekly Main Refinancing Operation. The auction was conducted on Tuesday, March 20, and attracted bids from euro area eligible counterparties of €59.54 billion, €17.36 billion higher than the amount bid for in 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 Tuesday, March 20, the ECB conducted an auction for a seven-day fixed-term deposit intended to absorb €218 billion. This operation is 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, March 16.
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 one per cent. It attracted bids amounting to €429.70 billion, with the ECB allotting €218 billion, or 50.73 per cent, of the total amount bid for. The marginal rate on the auction was set at 0.26 per cent, with the weighted average rate also at 0.26 per cent.
On Wednesday, March 21, 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 $1.80 billion, which were allotted in full at a fixed rate of 0.65 per cent.
Domestic Treasury bill market
In the domestic primary market for Treasury bills the Treasury invited tenders for 91-day and 181-day bills maturing on June 22 and September 20, respectively. Bids of €4.25 million were submitted for the 91-day bills, with the Treasury accepting €2.25 million, while bids of €3 million were submitted for the 181-day bills, with the Treasury accepting the full amount. Since €4.7 million worth of bills matured during the week, the outstanding balance of Treasury bills increased by €0.55 million, to stand at €213.81 million.
The yield from the 91-day bill auction was 0.847 per cent, i.e. 0.1 basis points lower than that on bills with a similar tenor issued on March 16, representing a bid price of 99.7864 per 100 nominal.
The yield from the 181-day bill auction was 1.05 per cent, i.e. five basis points higher than on bills with a similar tenor issued on February 24, representing a bid price of 99.4749 per 100 nominal.
During the week under review, there was no trading on the Malta Stock Exchange.
Today, the Treasury will invite tenders for 90-day bills maturing on June 28.