Money Market Report for the week ending January 27, 2017

ECB Monetary Operations

On January 23, 2017, the European Central Bank (ECB) announced its weekly main refinancing operation (MRO). The operation was conducted on January 24, 2017, and attracted bids from euro area eligible counterparties of €33.99 billion, €1.66 billion 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 January 25, 2017, 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 €3.35 billion from euro area eligible counterparties. The amount was allotted in full in accordance with current ECB policy.

Also on January 25, 2017, 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 $0.27 billion, 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-day and 182day bills for settlement value January 26, 2017, maturing on February 23 and July 27, 2017, respectively. Bids of €55.00 million were submitted for the 28-day bills, with the Treasury accepting €2.00 million, while bids of €60.00 million were submitted for the 182-day bills, with the Treasury accepting €8.00 million. Since no bills matured during the week, the outstanding balance of Treasury bills increased by €10.00 million, to stand at €278.20 million.

The yield from the 28-day bill auction was -0.396%, down by 0.2 basis point from bids with a similar tenor issued on December 15, 2016, representing a bid price of €100.0308 per €100 nominal. The yield from the 182-day bill auction was -0.392%, down by 0.1 basis point from bids with a similar tenor issued on January 19, 2017, representing a bid price of €100.1986 per €100 nominal.

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

On Tuesday the Treasury invited tenders for 91-day and 182-day bills maturing on May 4 and August 3, 2017, respectively.