On Thursday, February 4, the Governing Council of the European Central Bank (ECB) decided to keep the interest rate on its main refinancing operations unchanged at one per cent. Interest rates on the marginal lending facility and the deposit facility were also left unchanged, at 1.75 per cent and 0.25 per cent, respectively.

On Monday, February 1, the ECB announced its weekly Main Refinancing Operation (MRO). This auction, which was conducted on Tuesday, attracted bids for €55.82 billion from euro area eligible counterparties, €7.62 billion less 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 the current ECB policy.

In the domestic primary market for Treasury bills, the Treasury invited tenders for 182-day bills maturing on August 6, 2010. Bids for €147.51 million were submitted, with the Treasury allotting €59 million. Since €51.67 million worth of bills matured during the week, the outstanding balance of Treasury bills increased by €7.33 million to €472.34 million.

The yield resulting from the auction was 1.247 per cent, i.e. 11.6 basis points less than that on bills with a similar tenor issued on January 15, 2010. The latest yield represented a bid price of 99.3735 per 100 nominal. Today, the Treasury will invite tenders for 91-day bills maturing on May 14, 2010.

Treasury bill trading on the Malta Stock Exchange amounted to €2.04 million during the week. Concurrently, all off-exchange transactions amounting to €0.12 million were transacted by the Central Bank of Malta.