Eurosystem Monetary Operations

On Monday, 21 April, the European Central Bank (ECB) announced its weekly Main Refinancing Operation (MRO). This operation attracted bids for e218.4 billion from euro area eligible counterparties. The ECB allotted e173 billion, or 79.2 per cent 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 per cent, unchanged from the rate resulting from the MRO of the previous week.

On Friday, 18 April, the ECB also announced that, once again, in conjunction with the Federal Reserve, it was to provide dollar liquidity to the market through the Term Auction Facility (TAF). This was in order to help satisfy the exceptional need for dollar funding and to facilitate the further normalisation of conditions in the international money market. This operation attracted bids for USD 30.13 billion, of which USD 15 billion, equivalent to 49.8 per cent of the total bid for, was allotted.

Domestic Treasury Bill Market

In the domestic primary market for Treasury bills, the Treasury invited tenders for 91-day bills maturing on 25 July 2008. Out of the e20.3 million worth of bids submitted, the Treasury accepted bids for e19.8 million. Since no Treasury bills matured during the week, the outstanding balance of Treasury bills rose to e351.6 million.

The yield resulting from the auction was 4.642 per cent, that is 13.8 basis points higher than that on bills with a similar tenor issued on 18 April 2008. The latest yield represented a bid price of 98.8402 per 100 nominal.

On Tuesday the Treasury invited tenders for 91-day bills maturing 1 August 2008. The following week the Treasury will once again invite tenders for 182-day bills maturing 7 November 2008.

Treasury bill trading on the Malta Stock Exchange amounted to e706,794, with the Bank acting as market marker. No transactions were conducted off-Exchange.