ECB allots 15 billion euros in quick refinancing operation
FRANKFURT - The European Central Bank (ECB) alloted 15 billion euros (23 billion dollars) on Thursday in a quick refinancing operation aimed at offseting a projected liquidity shortage in the money market.
Central banks often ensure the banking sector is well supplied with cash ahead of long holiday weekends, in this case Easter Sunday.
The ECB received bids totalling 65.81 billion euros for funds that were offered for five days, it said in a statement.
The offer was a so-called fine tuning operation, a process by which the bank controls the amount of cash available to markets on which commercial banks lend to each other.
Money market tension has risen again owing to renewed uncertainty over banks’ financial positions in light of US economic woes.
The average rate at which bids were accepted was 4.20 percent, while the marginal rate, or lowest rate at which bids were accepted, was 4.13 percent.
The ECB had set a minimum bid rate of 4.00 percent for the tender.