On Monday, May 11, the ECB announced its weekly Main Refinancing Operation. This attracted bids for €229.57 billion from euro area eligible counterparties, which amount was allotted in full in accordance with the current ECB policy at a fixed rate equivalent to the new main refinancing rate of one per cent.
On the same day, the Eurosystem and the Swiss National Bank (SNB) conducted a EUR/CHF foreign exchange swap, with a seven-day maturity, to provide Swiss franc liquidity against the euro. This operation attracted bids for €37.15 billion. As this exceeded the intended volume of €25 billion, participating counterparties received 67.29 per cent of the amounts bid for. This operation was conducted at a fixed price of -1.83 swap points.
On Tuesday, May 12, the ECB conducted a Special Term Refinancing Operation with a maturity of 28 days. The ECB received bids for €116.06 billion, which amount was allotted in full at a fixed rate equivalent to the ECB's main refinancing rate of one per cent.
On the same day, the ECB announced two supplementary Longer-Term Refinancing Operations, one with a maturity of 91 days and the other with a maturity of 182 days. These operations received bids for €33.67 billion and €20.69 billion, respectively, which amounts were allotted in full in accordance with current ECB policy at a fixed rate equivalent to the ECB's main refinancing rate of one per cent.
Also on May 12, it being the end of the reserve deposit maintenance period, the ECB conducted an overnight liquidity-absorbing fine-tuning operation. This was carried out at a variable rate, with the maximum rate being set at the previous MRO rate of 1.25 per cent, since the new MRO rate of one per cent was effective from May 13. This operation received bids for €109.09 billion, with the ECB allotting €108.06 billion, or 99.06 per cent of the total amount bid for. The marginal rate on this operation was 1.05 per cent.
On Wednesday, May 13, the ECB, in conjunction with the US Federal Reserve, conducted a US dollar funding operation, with a tenor of seven-days. This attracted bids for $63.02 billion, which amount was allotted in full at a fixed rate of 1.19 per cent.
In the domestic primary market for Treasury bills, the Treasury invited tenders for 91-day bills maturing on August 14. Bids for €88.33 million were submitted, with the Treasury allotting €33.03 million.
Since €21.31 million worth of bills matured during the week, the outstanding balance of Treasury bills increased by €11.72 million to €586.50 million.
The yield resulting from the auction was 1.899 per cent, i.e. 9.9 basis points less than that on bills with a similar tenor issued on April 30. This decrease in the 91-day Treasury bill yield partially reflected the impact of the 25 basis point cut in the ECB's main refinancing rate effective from May 13. The latest yield represented a bid price of 99.5223 per 100 nominal.
Today the Treasury will invite tenders for 28-day bills maturing on June 19 and for 91-day bills maturing on August 21.
Treasury bill trading on the Malta Stock Exchange amounted to €7.84 million during the week, with €7.49 million trades being conducted by the Central Bank of Malta in its role as market maker, while trades conducted by other brokers amounted to €0.35 million.