ECB monetary operations

On January 9, the European Central Bank announced the seven-day main refinancing operation (MRO). The operation was conducted on January 10 and attracted bids from euro area eligible counterparties of €0.95 billion, €0.17 billion less than the previous week. The amount was allotted in full at a fixed rate equivalent to the prevailing MRO rate of 2.50 per cent, in accordance with current ECB policy.

On January 11, the ECB conducted the seven-day US dollar funding operation through collateralised lending in conjunction with the US Federal Reserve. This operation attracted bids of $0.19 billion, which was allotted in full at a fixed rate of 4.58 per cent.

During the week under review, participants in the TLTRO-III operations 3 to 10 had the option of terminating or reducing their outstanding amount before maturity. Accordingly, on January 25, a total of €62.75 billion will be repaid.

Domestic Treasury bill market

In the domestic primary market for Treasury bills, the Treasury invited tenders for 91-day and 182-day bills for settlement value January 12, maturing on April 13, and July 13, respectively.

Bids of €207.45 million were submitted for the 91-day bills, with the Treasury accepting €52.15 million, while bids of €0.65 million were submitted for the 182-day bills, with the Treasury accepting €0.50 million. Since €35 million worth of bills matured during the week, the outstanding balance of Treasury bills increased by €17.65 million, standing at €853.45 million.

The yield from the 91-day bill auction was 2.408 per cent, increasing by 5.40 basis points from bids with a similar tenor issued on January 5, representing a bid price of €99.3950 per €100 nominal. The yield from the 182-day bill auction was 2.522 per cent, increasing by 1.80 basis points from bids with a similar tenor also issued on January 5, representing a bid price of €98.7410 per €100 nominal. During this week, there was no trading on the Malta Stock Exchange.

Today, January 17, the Treasury will invite tenders for 91-day and 182-day bills maturing on April 20, and July 20, respectively.

The report was prepared by the Monetary Operations and Collateral Management Office of the Central Bank of Malta.