Money Mar­ket Re­port for the week end­ing 4 Jan­uary

The Malta Business Weekly - - MARKETS -

ECB Mon­e­tary Op­er­a­tions

On 31 De­cem­ber, the Eu­ro­pean Cen­tral Bank an­nounced its weekly main re­fi­nanc­ing op­er­a­tion. The op­er­a­tion was con­ducted on 2 Jan­uary and at­tracted bids from euro area el­i­gi­ble coun­ter­par­ties of €8.21bn, €1.36bn lower 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 3 Jan­uary, 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 $0.08bn, which was al­lot­ted in full at a fixed rate of 2.90%.

Do­mes­tic Trea­sury Bill Mar­ket

In the do­mes­tic pri­mary mar­ket for Trea­sury bills, the Trea­sury in­vited ten­ders for 91-day and 182-day bills for set­tle­ment value 3 Jan­uary, ma­tur­ing on 4 April and 4 July, re­spec­tively. Bids of €28.50m were sub­mit­ted for the 91-day bills, with the Trea­sury ac­cept­ing €19m, while bids of €15m were sub­mit­ted for the 182-day bills, with the Trea­sury ac­cept­ing €1m. Since no bills ma­tured dur­ing the week, the out­stand­ing bal­ance of Trea­sury bills in­creased by €20m, to stand at €310m.

The yield from the 91-day bill auc­tion was -0.348%, up by 0.4 ba­sis point from bids with a sim­i­lar tenor is­sued on 28 De­cem­ber 2018, rep­re­sent­ing a bid price of €100.0880 per €100 nom­i­nal. The yield from the 182-day bill auc­tion was -0.289%, an in­crease of 6.4 ba­sis points from bids with a sim­i­lar tenor is­sued on 20 De­cem­ber 2018, rep­re­sent­ing a bid price of €100.1463 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 11 April.

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