ECB drains 69b eu­ros to off­set bond buys

The Pak Banker - - Company& -

FRANK­FURT: The Euro­pean Cen­tral Bank (ECB) com­fort­ably at­tracted the 69 bil­lion eu­ros it needed to off­set its pur­chases of euro-zone govern­ment bonds on Tues­day, but had to pay a higher rate of in­ter­est to do so than last week.

The ECB takes seven-day de­posits from com­mer­cial banks on a weekly ba­sis to off­set the amount it has spent buy­ing govern­ment bonds since May. The ECB in­creased the pace of its pur­chases last week, spend­ing close to 2 bil­lion eu­ros.

The ECB paid a weighted av­er­age in­ter­est rate of 0.65 per­cent on funds de­posited, com­pared with the 0.41 per­cent paid last week. Fund­ing may be tighter than usual for banks. Tues­day is also the fi­nal day of the ECB's cur­rent re­serves main­te­nance pe­riod. -PB News

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