Money Market Report for the week ending 2 August

ECB Monetary Operations

On 29 July, the European Central Bank announced its weekly main refinancing operations. The operation was conducted on 30 July and attracted bids from euro area eligible counterparties of €3.60bn, €0.69bn 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 31 July, 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 €0.79bn from euro area eligible counterparties. The amount was allotted in full in accordance with current ECB policy.

Also on 31 July, the ECB conducted a six-day US dollar funding operation through collateralised lending in conjunction with the US Federal Reserve. This operation attracted bids of $0.03bn, which was allotted in full at a fixed rate of 2.61%.

Domestic Treasury Bill Market

In the domestic primary market for Treasury bills, the Treasury invited tenders for 91-day and 273-day bills for settlement value 1 August, maturing on 31 October and 30 April 2020, respectively. Bids of €50m were submitted for the 91-day bills, with the Treasury accepting €20m, while bids of €50m were also submitted for the 273-day bills, with the Treasury accepting €2m. Since €35m worth of bills matured during the week, the outstanding balance of Treasury bills decreased by €13m, at €311.8m.

The yield from the 91-day bill auction was -0.365%, an increase of 0.8 basis point from bids with a similar tenor issued on 25 July, representing a bid price of €100.0923 per €100 nominal. The yield from the 273-day bill auction was -0.330%, a decrease of 4.5 basis points from bids with a similar tenor issued on 21 March, representing a bid price of €100.2509 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-day bills maturing on 7 November.