Money market report for the week ended January 5, 2024
Information on ECB monetary operations and the domestic Treasury bill market
ECB monetary operations
On December 29, the European Central Bank (ECB) announced the seven-day main refinancing operations (MRO). The operation was conducted on January 2 and attracted bids from euro area eligible counterparties of €7,374.50 million, €6,710 million less than the previous week. The amount was allotted in full at a fixed rate equivalent to the prevailing MRO rate of 4.50%, in accordance with current ECB policy.
On January 3, the ECB conducted a seven-day US dollar funding operation through collateralised lending in conjunction with the US Federal Reserve. This operation attracted bids of $222.50 million, which were allotted in full at a fixed rate of 5.58%.
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 4, maturing on April 4 and July 4, respectively.
Bids of €53.06 million were submitted for the 91-day bills, with the Treasury accepting €13.06 million, while bids of €5.73 million were submitted for the 182-day bills, with the Treasury accepting all amounts. Since €33.19 million worth of bills matured during the week, the outstanding balance of Treasury bills decreased by €14.40 million, standing at €657.23 million.
The yield from the 91-day bill auction was 3.597%, increasing by 1.50 basis points from bids with a similar tenor issued on December 29, representing a bid price of €99.0990 per €100 nominal. The yield from the 182-day bill auction was 3.449%, increasing by 0.60 basis point from bids with a similar tenor also issued on December 29, representing a bid price of €98.2862 per €100 nominal.
During this week, secondary market turnover in Malta Government Treasury bills amounted to €100,000, all executed on the on-exchange market of the Malta Stock Exchange.
Today, the Treasury will invite tenders for 91-day and 182-day bills maturing on April 11 and July 11, 2024, respectively.
This article is prepared by the Monetary Operations and Collateral Management Office of the Central Bank of Malta.