Money Market Report for the week ending 6 November

ECB Monetary Operations

On 2 November, the European Central Bank announced the seven-day Main Refinancing Operation. The operation was conducted on 3 November and attracted bids from euro area eligible counterparties of €0.93bn, €0.11bn less 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 4 November, the ECB conducted the Pandemic Emergency Longerterm Refinancing Operation (PELTRO) maturing on 29 July 2021, which attracted bids from euro area eligible counterparties of €0.75bn. This operation was carried out through a fixed rate tender procedure with full allotment, with an interest rate that is equal to 25 basis points below the average MRO rate over the life of the PELTRO.

Also on 4 November, the ECB conducted the seven-day and 84-day US dollar funding operations through collateralised lending in conjunction with the US Federal Reserve. The seven-day USD operation attracted bids of $0.20bn, which was allotted in full at a fixed rate of 0.34%. The 84day USD operation was carried out at a fixed rate of 0.33% and did not attract bids from euro area eligible counterparties.

Domestic Treasury Bill Market

In the domestic primary market for Treasury bills, the Treasury invited tenders for 28-day bills and 91-day bills for settlement value 5 November, maturing on 3 December and 4 February 2021, respectively. Bids of €96m were submitted for the 28-day bills, with the Treasury accepting €13m, while bids of €100m were submitted for the 91-day bills, with the Treasury accepting €12m. Since €40m worth of bills matured during the week, the outstanding balance of Treasury bills decreased by €15m, to stand at €671.5m.

The yield from the 28-day bill auction was -0.491%, a decrease of 0.3 basis points from bids with a similar tenor issued on 29 October, representing a bid price of €100.0382 per €100 nominal. The yield from the 91day bill auction was -0.492%, a decrease of 0.3 basis points from bids with a similar tenor also issued on 29 October, representing a bid price of €100.1245 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 28-day bills and 91-day bills maturing on 10 December and 11 February 2021, respectively.