FRANKFURT (MNI) – The European Central Bank announced on Monday
that no bond buys were settled through its Securities Market Programme
in the week ending April 29, fueling suspicions that the bank is all but
ending its controversial bond buy program.
A number of ECB Governing Council members, including Juergen Stark
and Athanasios Orphanides, have recently hinted that the central bank
may end its bond market interventions.
With the bank having remained on the sidelines for a record fifth
consecutive week, the total volume of funds that the central bank will
seek to drain remained at 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.
— Frankfurt bureau: +49 69 720 142; email: frankfurt@marketnews.com —
[TOPICS: MGX$$$,M$X$$$,M$$EC$]