On Monday, 10 November, the ECB announced its weekly Main Refinancing Operation (MRO). This attracted bids for e334.41 billion from euro area eligible counterparties, which amount was totally allotted, as pre-announced, at a fixed rate equivalent to the new main refinancing rate of 3.25 per cent.
Also on Monday, 10 November, the Eurosystem and the Swiss National Bank (SNB) conducted a EUR/CHF foreign exchange swap, with a 7-day maturity, to provide Swiss franc liquidity against euro. This operation attracted bids for e10.59 billion, which amount was also fully allotted at a fixed price of -6.97 swap points.
On Tuesday, 11 November, the ECB announced two supplementary Longer-Term Refinancing Operations (LTRO), with a maturity of 91-days and 182-days, respectively. In the 91-day LTRO, the ECB received bids for e66.81 billion, which amount was fully allotted. In the 182-day LTRO, the ECB received bids for e41.56 billion, which amount was again fully allotted. Both LTROs were conducted at a fixed rate equivalent to the ECB’s main refinancing rate of 3.25 per cent.
On the same day, being the end of the reserve deposit maintenance period, the ECB also conducted an overnight liquidity-absorbing Fine Tuning Operation.
This was carried out at a variable rate with a maximum rate of 3.75 per cent. Counterparties were able to submit a maximum of two bids each. This operation received bids for e49.66 billion, with the ECB accepting e79.94 billion, or 53.4 per cent of the total amount bid for. The marginal rate on this operation was set at 3.60 per cent.
On Wednesday, 12 November, the ECB, in conjunction with the US Federal Reserve, conducted a 7-day US dollar funding operation through collateralised lending. This attracted bids for $60.57 billion, which amount was fully allotted at a fixed rate of 1.43 per cent. In parallel with this operation, the Eurosystem also offered 7-day dollar liquidity through a EUR/USD foreign exchange swap operation which attracted bids for $1.01 billion, which amount was fully allotted at a fixed price of -3.22 swap points.
Domestic Treasury
Bill Market
In the domestic primary market for Treasury bills, the Treasury invited tenders for 91-day bills maturing on 13 February 2009. Bids for e23.37 million were submitted, with the Treasury accepting e6.60 million.
Since e11.24 million worth of bills matured during the week, the outstanding balance of Treasury bills decreased by e4.65 million to e368.34 million.
The yield resulting from the auction was 3.958 per cent, 31.7 basis points lower than that on bills with a similar tenor issued on 7 November 2008.
The latest yield represented a bid price of 99.0094 per 100 nominal. On Tuesday, the Treasury invited tenders for 182-day bills maturing on 22 May 2009.
Treasury bill trading on the Malta Stock Exchange amounted to e2.44 million during the week, with all trades being conducted by the Central Bank of Malta in its role as market maker. Off-Exchange transactions amounted to e400,000.