On Monday, 26 October, the European Central Bank (ECB) announced its weekly Main Refinancing Operation (MRO). This auction, which was conducted on Tuesday, attracted bids for €48.66 billion from euro area eligible counterparties, €1.14 billion less than the amount bid for in the previous week. The bid amount was allotted in full at a fixed rate equivalent to the prevailing main refinancing rate of one per cent in accordance with current ECB policy.

Also on Monday, 26 October, the Eurosystem and the Swiss National Bank (SNB) conducted a EUR/CHF foreign exchange swap, with a seven-day maturity, to provide Swiss franc liquidity against euro. This operation attracted bids for E5.18 billion, and since this was well below the intended amount of E25 billion, all bids were allotted in full at a fixed price of -0.84 swap points.

On Tuesday, 27 October, the ECB announced a standard Longer-Term Refinancing Operation (LTRO) with a maturity of 91-days. In this LTRO, the ECB received bids for E3.28 billion, which amount was allotted in full at a fixed rate equivalent to the prevailing main refinancing rate of one per cent.

On Wednesday, 28 October, the ECB, in conjunction with the US Federal Reserve, conducted a seven-day US dollar funding operation through collateralised lending. This attracted bids for $23.15 billion, which amount was allotted in full at a fixed rate of 1.12 per cent.

Domestic Treasury Bill Market

In the domestic primary market for Treasury bills, the Treasury invited tenders for 91-day bills maturing on January 29, 2010 and 182-day bills maturing on 30 April, 2010. Bids for E29.15 million were submitted for the 91-day bills, with the Treasury accepting E6.10 million, while bids for E27.21 million were submitted for the 182-day bills, with the Treasury accepting E16.61 million. Since E40.28 million worth of bills matured during the week, the outstanding balance of Treasury bills decreased by E17.58 million to E582.43 million.

The yield resulting from the 91-day bill auction fell to a new record low of 1.442 per cent, 1.6 basis points below that on bills with a similar tenor issued on 23 October, 2009. The latest yield on such bills represented a bid price of 99.6368 per 100 nominal. The yield resulting from the 182-day bill auction was 1.613 per cent, i.e. 0.9 basis points lower than that on bills with a similar tenor issued on 9 October, 2009. The yield on these bills represented a bid price of 99.1911 per 100 nominal.

On Tuesday the Treasury invited tenders for 182-day bills maturing on 7 May, 2010.

Treasury bill trading on the Malta Stock Exchange amounted to E3.30 million during the week, with E0.64 million trades being conducted by the Central Bank of Malta in its role as market facilitator and E2.65 million trades being conducted by other brokers.