ECB monetary operations
On August 31, the European Central Bank announced a seven-day Main Refinancing Operation (MRO). The operation was conducted on September 1 and attracted bids from euro area eligible counterparties of €1.57 billion, €0.07 billion 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 zero per cent, in accordance with current ECB policy.
On September 2, the ECB conducted the Pandemic Emergency Longer-term Refinancing Operation (PELTRO) maturing on August 26, 2021, which attracted bids from euro area eligible counterparties of €0.79 billion. 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 September 2, the ECB conducted the seven-day and 85-day US dollar funding operations through collateralised lending in conjunction with the US Federal Reserve.
The seven-day USD operation attracted bids of $0.03 billion, which was allotted in full at a fixed rate of 0.34 per cent. The 85-day USD operation attracted bids of $0.04 billion, which was allotted in full at a fixed rate of 0.32 per cent.
Domestic Treasury bill market
In the domestic primary market for Treasury bills, the Treasury invited tenders for 91-day bills and 182-day bills for settlement value September 3, maturing on December 3, 2020 and March 4, 2021, respectively. Bids of €109 million were submitted for the 91-day bills, with the Treasury accepting €28 million, while bids of €111 million were submitted for the 182-day bills, with the Treasury accepting €11 million. Since €45 million worth of bills matured during the week, the outstanding balance of Treasury bills decreased by €6 million, standing at €791 million.
The yield from the 91-day bill auction was -0.470 per cent, a decrease of 0.7 basis point from bids with a similar tenor issued on August 27, representing a bid price of €100.1189 per €100 nominal. The yield from the 182-day bill auction was -0.473 per cent, an increase of 0.6 basis point from bids with a similar tenor issued on August 20, representing a bid price of €100.2397 per €100 nominal.
During the week under review, there was no trading on the Malta Stock Exchange.
Yesterday, the Treasury invited tenders for 91-day bills and 273-day bills maturing on December 10, 2020 and June 10, 2021, respectively.