FRANKFURT (MNI) – The European Central Bank announced for the third
consecutive week on Monday that no bond purchases were settled through
its Securities Market Programme.
The bank also reported that E830 million in securities purchased
through the SMP had matured.
As a result, the total amount of funds that the central bank will
seek to drain declined to E76.0 billion. The ECB will drain that amount
in a quick tender to collect one-week term deposits.
The operation, to be conducted on Tuesday at 9:30 GMT, will be in
the form of a variable-rate tender with a maximum bid rate of 1.25%, the
bank said. The liquidity will be held for one week at the bank as a term
deposit. The fixed-term deposits can be used as collateral in the
Eurosystem’s credit operations.
The central bank also said it intends to hold another
liquidity-absorbing operation next week.
Recent media reports raising the prospect that Greece’s sovereign
debt will be restructured have sparked another flareup in the sovereign
debt crisis, pushing spreads on Greek 10-year bonds to well above 1,000
basis points, a record high.
— Frankfurt bureau: +49 69 720 142; email: frankfurt@marketnews.com —
[TOPICS: MGX$$$,M$X$$$,M$$EC$]