Eurosystem Monetary Operations

On Monday 14 April, the European Central Bank (ECB) announced its weekly Main Refinancing Operation (MRO). This operation attracted bids for e249.7 billion from euro area eligible counterparties. The ECB allotted e204.5 billion, or 81.9% of the total amount bid for. The marginal rate, which is the rate at which the total tender allotment is exhausted, was set by the ECB at 4.21%, down two basis points from the rate that resulted from the MRO of the previous week.

On Tuesday 15 April, it being the end of the maintenance period, the ECB also launched a fine-tuning operation. The ECB intended to absorb e21 billion through a liquidity absorbing operation, set at a fixed rate of four per cent. But as bids for a total of e14.9 million only were submitted, they were fully met.

Domestic Treasury Bill Market

In the domestic primary market for Treasury bills, the Treasury invited tenders for 91-day bills maturing on 18 July 2008. The Treasury accepted in full the e16.2 million worth of bids submitted. Since e2 million worth of bills matured during the week, the outstanding balance of Treasury bills increased by e14.2 million to e331.8 million.

The yield resulting from the auction was 4.504%, that is 20.8 basis points higher than that on bills with a similar tenor issued on 4 April 2008. The latest yield represented a bid price of 98.8743 per 100 nominal.

On Tuesday, the Treasury invited tenders for 91-day bills maturing 25 July 2008.

Treasury bill trading on the Malta Stock Exchange amounted to only e65,100, with the bank acting as market maker. No transactions were conducted off-Exchange.