Money Market Report for the week ending 24 February

ECB Monetary Operations

On 20 February, the European Central Bank (ECB) announced its weekly main refinancing operation (MRO). The operation was conducted on 21 February and attracted bids from euro area eligible counterparties of €30.83bn, €2.82bn higher 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%, in accordance with current ECB policy.

On 22 February, the ECB conducted a three-month, longerterm refinancing operation to be settled as a fixed rate tender procedure with full allotment, with the rate fixed at the average rate of the MROs over the life of the operation. The operation attracted bids of €2.58bn from euro area eligible counterparties. The amount was allotted in full in accordance with current ECB policy.

Also on 22 February, 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 $0.93bn, which was allotted in full at a fixed rate of 1.15%.

Domestic Treasury Bill Market

In the domestic primary market for Treasury bills, the Treasury invited tenders for 28- and 182-day bills for settlement value 23 February, maturing on 23 March and 24 August, respectively. Bids of €35m were submitted for the 28day bills, with the Treasury accepting €2m, while bids of €20m were submitted for the 182-day bills, with the Treasury accepting €4m. Since €4m worth of bills matured during the week, the outstanding balance of Treasury bills increased by €2m, to stand at €269.20m.

The yield from the 28-day bill auction was -0.350%, up by 4.6 basis points from bids with a similar tenor issued on 26 January, representing a bid price of €100.0272 per €100 nominal. The yield from the 182-day bill auction was -0.377%, also up by 1.6 basis points from bids with a similar tenor issued on 2 February, representing a bid price of €100.1910 per €100 nominal.

During the week under review, there was no trading on the Malta Stock Exchange.

This week the Treasury will invite tenders for 91- and 182-day bills maturing on 1 June and 31 August, respectively.