FRANKFURT (MNI) – The European Central Bank again sat on the
sidelines and failed to purchase any Eurozone bonds on the secondary
market last week, the bank announced Monday.
This comes after the ECB surprised observers by settling no
purchases in the weeks ending October 15 and October 22.
On Tuesday, the ECB will reabsorb E63.5 billion in cumulative
purchases of government bonds via a quick tender to collect one-week
term deposits, the central bank said.
The total is equivalent to the number of bonds purchased through
the Securities Market Program, the formal name of the bank’s
bond-purchase program, and settled as of last Friday, rounded to the
nearest half billion.
“As no SMP transactions were settled last week, it happens that the
rounded settled amount – and the amount for absorption accordingly –
remains unchanged at E63.5 billion” the ECB said.
The operation, to be conducted on Tuesday at 10:30 GMT, will be in
the form of a variable-rate tender with a maximum bid rate of 1.00%, the
bank said.
The liquidity will be held for one week at the bank as a term
deposit. These fixed-term deposits can be used as collateral for the
Eurosystem’s credit operations, the ECB said. The central bank said it
intends to hold another liquidity-absorbing operation next week.
–Frankfurt bureau: +49 69 720 142; email: frankfurt@marketnews.com —
[TOPICS: MGX$$$,M$$FX$,M$X$$$,M$$EC$]
