COVID-19 Information Hub: Monetary policy

This page is no longer being regularly updated. For ongoing market data updates, please refer to ICMA’s Central Bank corporate bond purchase programmes page, comprising data and commentary on both European Central Bank and Bank of England programmes.

In addition to the monetary policy responses from the jurisdictions below, the IMF also published a Policy Tracker Policy Tracker summarising key economic responses of governments worldwide. The key economic responses are categorised under fiscal, monetary and macro-financial, and exchange rate and balance of payments.

Jurisdictions:

International

14 October 2020: Meeting of the Finance Ministers & Central Bank Governors

The G20 Leaders held another virtual meeting on COVID-19 and issued a communiqué reiterating its commitments and updates to the G20 Action Plan – supporting the global economy through the global pandemic.

Virtual Meeting Communique

22 April 2020: IMF Executive Board – IMF COVID-19 Response—A New Short-Term Liquidity Line to Enhance the Adequacy of the Global Financial Safety Net

As demand for liquidity has grown, and global uncertainty has increased, the IMF established a new Short-term Liquidity Line (SLL) as part of its COVID-19 response. The SLL aims to minimize the risk of shocks evolving into deeper crises and spilling over to other countries. Directors supported the creation of the SLL for a period of 7 years, with an expectation that, by end 2025, the Executive Board will decide whether to extend the facility beyond the 7 year period.

Full press release
Short-term Liquidity Line (SLL) Factsheet

24 March 2020: IMF publishes policy tracker summarising key economic responses of governments

The IMF has published a policy tracker that summarizes the key economic responses governments are taking to limit the human and economic impact of the COVID-19 pandemic as of 24 March 2020. The tracker includes G-20 economies and the European Union/Euro Area. More countries will be added soon.

19 March 2020: Federal Reserve announces the establishment of temporary U.S. dollar liquidity arrangements with other central banks

The Federal Reserve on Thursday announced the establishment of temporary U.S. dollar liquidity arrangements (swap lines) with the Reserve Bank of Australia, the Banco Central do Brasil, the Danmarks Nationalbank (Denmark), the Bank of Korea, the Banco de Mexico, the Norges Bank (Norway), the Reserve Bank of New Zealand, the Monetary Authority of Singapore, and the Sveriges Riksbank (Sweden). These facilities, like those already established between the Federal Reserve and other central banks, are designed to help lessen strains in global U.S. dollar funding markets, thereby mitigating the effects of these strains on the supply of credit to households and businesses, both domestically and abroad.

These new facilities will support the provision of U.S. dollar liquidity in amounts up to $60 billion each for the Reserve Bank of Australia, the Banco Central do Brasil, the Bank of Korea, the Banco de Mexico, the Monetary Authority of Singapore, and the Sveriges Riksbank and $30 billion each for the Danmarks Nationalbank, the Norges Bank, and the Reserve Bank of New Zealand. These U.S. dollar liquidity arrangements will be in place for at least six months.

15 March 2020: Coordinated Central Bank Action to Enhance the Provision of U.S. Dollar Liquidity

The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank are today announcing a coordinated action to enhance the provision of liquidity via the standing U.S. dollar liquidity swap line arrangements.

These central banks have agreed to lower the pricing on the standing U.S. dollar liquidity swap arrangements by 25 basis points, so that the new rate will be the U.S. dollar overnight index swap (OIS) rate plus 25 basis points. To increase the swap lines' effectiveness in providing term liquidity, the foreign central banks with regular U.S. dollar liquidity operations have also agreed to begin offering U.S. dollars weekly in each jurisdiction with an 84-day maturity, in addition to the 1-week maturity operations currently offered. These changes will take effect with the next scheduled operations during the week of March 16.1 The new pricing and maturity offerings will remain in place as long as appropriate to support the smooth functioning of U.S. dollar funding markets.

The swap lines are available standing facilities and serve as an important liquidity backstop to ease strains in global funding markets, thereby helping to mitigate the effects of such strains on the supply of credit to households and businesses, both domestically and abroad.

Eurozone:

7 January 2021: ECB Economic Bulletin Issue 8/2020: Liquidity conditions and monetary policy operations in the period from 22 July to 3 November 2020

The ECB’s latest Economic Bulletin Issue 8/2020 included a section describing the ECB’s monetary policy operations and liquidity developments during the fifth and sixth reserve maintenance periods of 2020, which ran from 22 July to 15 September and from 16 September to 3 November 2020, respectively. During this period, there was a stabilisation of the market volatility associated with the coronavirus (COVID-19) crisis earlier in the year.

The levels of central bank liquidity in the banking system continued to rise during the fifth and sixth maintenance periods of 2020. This was largely due to the settlement of the third series of targeted longer-term refinancing operations (TLTRO III) and asset purchases conducted under the asset purchase programme (APP) and the pandemic emergency purchase programme (PEPP).

Liquidity conditions and monetary policy operations in the period from 22 July to 3 November 2020
ECB Economic Bulletin Issue 8/2020

10 December 2020: ECB releases Monetary policy decisions

The Governing Council of the ECB has taken the following monetary policy decisions:

The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00 per cent, 0.25 per cent and -0.50 per cent respectively.
The Governing Council decided to increase the envelope of the pandemic emergency purchase programme (PEPP) by €500 billion to a total of €1,850 billion. It also extended the horizon for net purchases under the PEPP to at least the end of March 2022. The Governing Council also decided to extend the reinvestment of principal payments from maturing securities purchased under the PEPP until at least the end of 2023.
The Governing Council decided to further recalibrate the conditions of the third series of targeted longer-term refinancing operations (TLTRO III). Specifically, it decided to extend the period over which considerably more favourable terms will apply by twelve months, to June 2022. Three additional operations will also be conducted between June and December 2021. Moreover, the Governing Council decided to raise the total amount that counterparties will be entitled to borrow in TLTRO III operations from 50 per cent to 55 per cent of their stock of eligible loans.
The Governing Council decided to extend to June 2022 the duration of the set of collateral easing measures adopted by the Governing Council on 7 and 22 April 2020. The extension of these measures will continue to ensure that banks can make full use of the Eurosystem’s liquidity operations, most notably the recalibrated TLTROs. The Governing Council will reassess the collateral easing measures before June 2022, ensuring that Eurosystem counterparties’ participation in TLTRO III operations is not adversely affected.
The Governing Council also decided to offer four additional pandemic emergency longer-term refinancing operations (PELTROs) in 2021, which will continue to provide an effective liquidity backstop.
Net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion. The Governing Council continues to expect monthly net asset purchases under the APP to run for as long as necessary to reinforce the accommodative impact of its policy rates, and to end shortly before it starts raising the key ECB interest rates.
The Eurosystem repo facility for central banks (EUREP) and all temporary swap and repo lines with non-euro area central banks will be extended until March 2022.
Finally, the Governing Council decided to continue conducting its regular lending operations as fixed rate tender procedures with full allotment at the prevailing conditions for as long as necessary.

The monetary policy measures taken today will contribute to preserving favourable financing conditions over the pandemic period, thereby supporting the flow of credit to all sectors of the economy, underpinning economic activity and safeguarding medium-term price stability.

Full press release
ECB extends pandemic emergency longer-term refinancing operations
ECB prolongs support via targeted lending operations for banks that lend to the real economy

29 October 2020: ECB releases Monetary policy decisions

The Governing Council of the ECB has taken the following monetary policy decisions:

(1) The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively.

(2) The Governing Council will continue its purchases under the pandemic emergency purchase programme (PEPP) with a total envelope of €1,350 billion. These purchases contribute to easing the overall monetary policy stance, thereby helping to offset the downward impact of the pandemic on the projected path of inflation. The purchases will continue to be conducted in a flexible manner over time, across asset classes and among jurisdictions.

(3) Net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion, together with the purchases under the additional €120 billion temporary envelope until the end of the year.

(4) The Governing Council will also continue to provide ample liquidity through its refinancing operations. In particular, the third series of targeted longer-term refinancing operations (TLTRO III) remains an attractive source of funding for banks, supporting bank lending to firms and households.

Full press release
8 October 2020: ECB releases Account of the monetary policy meeting of the Governing Council, 9-10 September 2020
The account of the monetary policy meeting of the Governing Council of the European Central Bank on Wednesday and Thursday 9-10 September 2020 was published, including the review of financial, economic and monetary developments and policy options, and the Governing Council’s monetary policy decisions.

Full press release

24 September 2020: ECB Economic Bulletin Issue 6/2020: Liquidity conditions and monetary policy operations

The ECB’s latest Economic Bulletin Issue 6/2020 included a section on liquidity conditions and monetary policy operations covering the period from 6 May to 21 July 2020. During this period, the market volatility associated with the coronavirus (COVID-19) crisis abated. This was helped by the implementation of measures announced by central banks, including the European Central Bank (ECB), and the fiscal support measures introduced by governments and EU authorities.

ECB Economic Bulletin, Issue 6/2020

17 September 2020: ECB’s Governing Council says that exceptional circumstances justify leverage ratio relief

The Governing Council of the European Central Bank (ECB) decided that it concurs with ECB Banking supervision that there are ‘exceptional circumstances’ allowing the temporary exclusion of certain central bank exposures from the leverage ratio.

Full press release

10 September 2020: ECB releases Monetary policy decisions

The Governing Council of the ECB has taken the following monetary policy decisions:

The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively.
The Governing Council will continue its purchases under the pandemic emergency purchase programme (PEPP) with a total envelope of €1,350 billion. These purchases contribute to easing the overall monetary policy stance, thereby helping to offset the downward impact of the pandemic on the projected path of inflation. The purchases will continue to be conducted in a flexible manner over time, across asset classes and among jurisdictions.
Net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion, together with the purchases under the additional €120 billion temporary envelope until the end of the year.
The Governing Council will also continue to provide ample liquidity through its refinancing operations. In particular, the latest operation in the third series of targeted longer-term refinancing operations (TLTRO III) has registered a very high take-up of funds, supporting bank lending to firms and households.

The Governing Council continues to stand ready to adjust all of its instruments, as appropriate, to ensure that inflation moves towards its aim in a sustained manner, in line with its commitment to symmetry.

Full press release

20 August 2020: ECB releases account of monetary policy meeting of the Governing Council, 15-16 July 2020

The account of the monetary policy meeting of the Governing Council of the European Central Bank 15-16 July 2020 was published, including the review of financial, economic and monetary developments and policy options, and the Governing Council’s monetary policy decisions.

Full press release

30 July 2020: ECB Economic Bulletin Issue 5/2020: The impact of the ECB’s monetary policy measures taken in response to the COVID-19 crisis

The ECB’s latest Economic Bulletin Issue 5/2020 included a section on the impact of the ECB’s monetary policy measures taken in response to the COVID-19 crisis. The publication covers the ECB’s response to the crisis, liquidity conditions, credit flows, and price stability among other items.

ECB Economic Bulletin, Issue 5/2020

16 July 2020: ECB releases Monetary policy decisions

The Governing Council of the ECB has taken the following monetary policy decisions:

The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively.
The Governing Council will continue its purchases under the pandemic emergency purchase programme (PEPP) with a total envelope of €1,350 billion.
Net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion, together with the purchases under the additional €120 billion temporary envelope until the end of the year.
The Governing Council will also continue to provide ample liquidity through its refinancing operations. In particular, the latest operation in the third series of targeted longer-term refinancing operations (TLTRO III) has registered a very high take-up of funds, supporting bank lending to firms and households.

The Governing Council continues to stand ready to adjust all of its instruments, as appropriate, to ensure that inflation moves towards its aim in a sustained manner, in line with its commitment to symmetry.

Full press release

25 June 2020: ECB sets up new Eurosystem repo facility to provide euro liquidity to non-euro area central banks

In response to the coronavirus (COVID-19) crisis, the Governing Council of the European Central Bank (ECB) decided to set up a new backstop facility, called the Eurosystem repo facility for central banks (EUREP), to provide precautionary euro repo lines to central banks outside the euro area. EUREP addresses possible euro liquidity needs in case of market dysfunction resulting from the COVID-19 shock that might adversely impact the smooth transmission of ECB monetary policy.

Under EUREP, the Eurosystem will provide euro liquidity to a broad set of central banks outside the euro area against adequate collateral, consisting of euro-denominated marketable debt securities issued by euro area central governments and supranational institutions.

EUREP complements the ECB’s bilateral swap and repo lines and reflects the importance of the euro in global financial markets. EUREP will be available until the end of June 2021.

Full press release
Eurosystem repo facility for central banks (EUREP) - FAQ

4 June 2020: ECB releases Monetary policy decisions

The Governing Council of the ECB has taken the following monetary policy decisions:

The envelope for the pandemic emergency purchase programme (PEPP) will be increased by €600 billion to a total of €1,350 billion.
The horizon for net purchases under the PEPP will be extended to at least the end of June 2021.
The maturing principal payments from securities purchased under the PEPP will be reinvested until at least the end of 2022.
Net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion, together with the purchases under the additional €120 billion temporary envelope until the end of the year.
Reinvestments of the principal payments from maturing securities purchased under the APP will continue, in full, for an extended period of time past the date when the Governing Council starts raising the key ECB interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation.
The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively.

The Governing Council continues to stand ready to adjust all of its instruments, as appropriate, to ensure that inflation moves towards its aim in a sustained manner, in line with its commitment to symmetry.

Full press release

ECB Governing Council Press Conference - 04 June 2020

11 May 2020: Official Journal of the European Union publishes Guideline (EU) 2020/634 of the European Central Bank of 7 May 2020

The Official Journal of the European Union published Guideline (EU) 2020/634 of the European Central Bank of 7 May 2020, amending Guideline ECB/2014/31 on additional temporary measures relating to Eurosystem refinancing operations and eligibility of collateral (ECB/2020/29). This follows the ECB’s announcement on 7 May 2020 of temporary collateral easing measures

Guideline (EU) 2020/634

5 May 2020: ECB takes note of German Federal Constitutional Court ruling and remains fully committed to its mandate

The Governing Council received a preliminary briefing by the governor of the Bundesbank and by the legal department of the European Central Bank (ECB). The ECB takes note of the judgment by the German Federal Constitutional Court regarding the Public Sector Purchase Programme (PSPP).

The Governing Council remains fully committed to doing everything necessary within its mandate to ensure that inflation rises to levels consistent with its medium-term aim and that the monetary policy action taken in pursuit of the objective of maintaining price stability is transmitted to all parts of the economy and to all jurisdictions of the euro area.

Full press release

4 May 2020: ECB publishes summary of decisions taken by the Governing Council

The ECB published an overview on decisions taken by the Governing Council in the areas of monetary policy, market operations, market infrastructure and payments, advice on legislation, corporate governance and banking supervision among other subjects.

30 April 2020: ECB publishes the Governing Council monetary policy decision

The Governing Council of the ECB took the following monetary policy decisions:

The conditions on the targeted longer-term refinancing operations (TLTRO III) have been further eased.
A new series of non-targeted pandemic emergency longer-term refinancing operations (PELTROs) will be conducted to support liquidity conditions in the euro area financial system and contribute to preserving the smooth functioning of money markets by providing an effective liquidity backstop.
The PEPP will continue to be conducted in a flexible manner over time, across asset classes and among jurisdictions. The Governing Council will conduct net asset purchases under the PEPP until it judges that the coronavirus crisis phase is over, but in any case until the end of this year.
Moreover, net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion, together with the purchases under the additional €120 billion temporary envelope until the end of the year.
Reinvestments of the principal payments from maturing securities purchased under the APP will continue, in full, for an extended period of time past the date when the Governing Council starts raising the key ECB interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation.
The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively.

The Governing Council is fully prepared to increase the size of the PEPP and adjust its composition, by as much as necessary and for as long as needed.

Monetary policy decisions

30 April 2020: ECB recalibrates targeted lending operations to further support real economy

The Governing Council of the European Central Bank (ECB) decided on a number of modifications to the terms and conditions of its targeted longer-term refinancing operations (TLTRO III).

Interest rate on all targeted longer-term refinancing operations (TLTRO III) reduced by 25 basis points to -0.5% from June 2020 to June 2021
For banks meeting the lending threshold of 0% introduced on 12 March 2020, the interest rate can be as low as -1%
Start of the lending assessment period brought forward to 1 March 2020

Full press release

30 April 2020: ECB announces new pandemic emergency longer-term refinancing operations

The Governing Council of the European Central Bank (ECB) decided to conduct a new series of seven additional longer-term refinancing operations, called pandemic emergency longer-term refinancing operations (PELTROs). These operations will provide liquidity support to the euro area financial system and contribute to preserving the smooth functioning of money markets by providing an effective backstop after the expiry of the bridge longer-term refinancing operations (LTROs) that have been conducted since March 2020.

Full press release

23 April 2020: ICMA letter to ECB regarding the eligibility of Asset Backed Commercial Paper for the Eurosystem monetary policy framework

ICMA, on behalf of its ECP Committee, wrote to the ECB requesting that Asset Backed Commercial Paper (ABCP) be included as eligible assets for the purpose of the ECB’s emergency policy response, being included both in the Eurosystem collateral framework and the Pandemic Emergency Purchase Programme (PEPP).

See full letter

22 April 2020: ECB takes steps to mitigate impact of possible rating downgrades on collateral availability

The Governing Council of the European Central Bank (ECB) adopted temporary measures to mitigate the effect on collateral availability of possible rating downgrades resulting from the economic fallout from the coronavirus (COVID-19) pandemic. The decision complements the broader collateral easing package that was announced on 7 April 2020.

Full press release

16 April 2020: ECB Banking Supervision provides temporary relief for capital requirements for market risk

The European Central Bank (ECB) announced a temporary reduction in capital requirements for market risk, by allowing banks to adjust the supervisory component of these requirements.

The ECB is temporarily reducing a supervisory measure for banks – the qualitative market risk multiplier – which is set by supervisors and is used to compensate for the possible underestimation by banks of their capital requirements for market risk. This decision will be reviewed after six months on the basis of observed volatility.

Full press release

15 April 2020: ECB supports macroprudential policy actions taken in response to coronavirus outbreak

The measures taken by euro area macroprudential authorities to address the impact of COVID-19 since 11 March 2020 will free up than € 20bn of Common Equity Tier 1 Capital held by euro area banks. The ECB has assessed the notifications submitted by national macroprudential authorities for each proposed measure provided for in CRR and CRD and has issued a non-objection decision, thereby endorsing the measures taken to reduce capital requirements, including the countercyclical capital buffer.

Full press release

7 April 2020: ECB announces package of temporary collateral easing measures

The Governing Council of the European Central Bank (ECB) adopted a package of temporary collateral easing measures to facilitate the availability of eligible collateral for Eurosystem counterparties to participate in liquidity providing operations, such as the targeted longer-term refinancing operations (TLTRO-III). The package is complementary to other measures recently announced by the ECB, including additional longer-term refinancing operations (LTROs) and the Pandemic Emergency Purchase Programme (PEPP) as a response to the coronavirus emergency.

Full press release

2 April 2020: ECB extends review of its monetary policy strategy until mid-2021

Full press release

30 March 2020: ECB addresses questions on CSPP and non-financial commercial paper

In the format of a FAQs page the ECB explains how the Eurosystem will operational commercial paper, following the Governing Council decision of 18 March 2020 to extend CSPP eligibility to non-financial commercial paper. The ECB may periodically update these FAQs and, therefore, please check the website for new FAQs or revisions to a previously issued FAQ.

26 March 2020: ECB addresses questions on the Pandemic emergency purchase programme (PEPP)

In the format of a FAQs page the ECB explains the Pandemic emergency purchase programme (PEPP), including key differences between the PEPP and the asset purchase programme (APP), PEPP rating requirements, bond maturities and target volumes, among other characteristics. The ECB may periodically update these FAQs and, therefore, please check the website for new FAQs or revisions to a previously issued FAQ.

25 March 2020: ECB publishes Decision (EU) 2020/440 of the European Central Bank of 24 March 2020 on a temporary pandemic emergency purchase programme (ECB/2020/17)

Taking into account the exceptional economic and financial circumstances associated with the spread of coronavirus disease 2019 (COVID-19), on 18 March 2020, the Governing Council decided to launch a new temporary pandemic emergency purchase programme ('PEPP') including all the asset categories eligible under the APP. Purchases under the PEPP will be separate from, and in addition to, purchases carries out under the APP, with an overall additional envelope of EUR 750 billion until the end of 2020. The PEPP is established in response to a specific, extraordinary and acute economic crisis which could jeopardise the objective of price stability and the proper functioning of the monetary policy transmission mechanism. Due to these exceptional, fast evolving and uncertain circumstances, the PEPP requires a high degree of flexibility in its design and implementation compared with the APP and its monetary policy objectives are identical to that of APP.

See decision here

25 March 2020: ECB publishes Decision (EU) 2020/441 of the European Central Bank of 24 March 2020 amending Decision (EU) 2016/948 of the European Central Bank on the implementation of the corporate sector purchase programme (ECB/2020/18)

Taking into account the exceptional economic and financial circumstances associated with the spread of coronavirus disease 2019 (COVID-19), on 18 March 2020, the Governing Council decided to expand the range of eligible assets under the CSPP to non-financial commercial papers, making all commercial papers of sufficient credit quality eligible for purchase under CSPP. Amendments are as follows:

If a marketable debt instrument has an initial maturity of 365/366 days or less, the minimum remaining maturity shall be 28 days at the time of its purchase by the relevant Eurosystem central bank.
If a marketable debt instrument has an initial maturity of 367 days or more, the minimum remaining maturity shall be 6 months and the maximum remaining maturity shall be 30 years and 364 days at the time of its purchase by the relevant Eurosystem central bank.

See decision here

18 March 2020: ECB announces €750 billion Pandemic Emergency Purchase Programme (PEPP)

The Governing Council announced the launch of a new temporary asset purchase programme of private and public sector securities to counter the serious risks to the monetary policy transmission mechanism and the outlook for the euro area posed by the outbreak and escalating diffusion of the coronavirus, COVID-19. This new Pandemic Emergency Purchase Programme (PEPP) will have an overall envelope of €750 billion. Purchases will be conducted until the end of 2020 and will include all the asset categories eligible under the existing asset purchase programme (APP).

Furthermore, it will expand the range of eligible assets under the corporate sector purchase programme (CSPP) to non-financial commercial paper, making all commercial papers of sufficient credit quality eligible for purchase under CSPP.

12 March 2020: ECB announces comprehensive package of monetary policy measures in response to COVID-19 risks

At its meeting on 12 March 2020, the ECB’s Governing Council decided on a comprehensive package of monetary policy measures intended to anticipate potential downside risks resulting from the COVID-19 pandemic. These included:

A temporary increase in the APP until the end of the year, adding additional net purchases of €120bn. The ECB emphasised a strong contribution from the private sector purchases programmes, suggesting a relative step-up in CSPP purchases.
Additional longer-term refinancing operations (LTROs).  These will be carried out through a fixed rate tender procedure with full allotment, with an interest rate that is equal to the average rate on the deposit facility.
More favourable terms applied to all outstanding targeted longer-term refinancing operations (TLTROs) for the period of June 2020 to June 2021, intended to provide additional support through bank-lending to SMEs.

Furthermore, the ECB announced that banks will be allowed partially to use some of their non-Tier 1 capital buffers, as well as their liquidity coverage ratio, to provide capital relief for the banking sector intended to support lending to the real economy.

The ECB decided to leave rates unchanged.

US:

19 February 2021: Federal Reserve releases Monetary Policy Report

The Federal Reserve has published its Monetary Policy Report, covering the conduct of monetary policy and economic developments and prospects for the future. The Federal Open Market Committee (FOMC) has held its policy rate near zero and has continued to purchase Treasury securities and agency mortgage-backed securities to support the economic recovery. These measures, along with the Committee’s strong guidance on interest rates and the balance sheet, will ensure that monetary policy will continue to deliver powerful support to the economy until the recovery is complete.

17 February 2021: Federal Reserve releases minutes of the Federal Open Market Committee, January 26-27, 2021

The Federal Reserve Board and the Federal Open Market Committee released the attached minutes of the Committee meeting held on January 26-27, 2021.

Full press release
Minutes

27 January 2021: Federal Reserve issues FOMC statement and Implementation Note

The Federal Reserve made the following decisions to implement the monetary policy stance announced by the Federal Open Market Committee in its statement on January 27, 2021:

The Board of Governors of the Federal Reserve System voted unanimously to maintain the interest rate paid on required and excess reserve balances at 0.10 percent, effective January 28, 2021.
As part of its policy decision, the Federal Open Market Committee voted to authorize and direct the Open Market Desk at the Federal Reserve Bank of New York, until instructed otherwise, to execute transactions in the System Open Market Account in accordance with the domestic policy directive (see directive in Implementation Note).
In a related action, the Board of Governors of the Federal Reserve System voted unanimously to approve the establishment of the primary credit rate at the existing level of 0.25 percent.

The Board of Governors of the Federal Reserve System voted unanimously to maintain the interest rate paid on required and excess reserve balances at 0.10 percent, effective December 17, 2020.
As part of its policy decision, the Federal Open Market Committee voted to authorize and direct the Open Market Desk at the Federal Reserve Bank of New York, until instructed otherwise, to execute transactions in the System Open Market Account in accordance with the domestic policy directive (see directive in Implementation Note).
In a related action, the Board of Governors of the Federal Reserve System voted unanimously to approve the establishment of the primary credit rate at the existing level of 0.25 percent.

The Board of Governors of the Federal Reserve System voted unanimously to maintain the interest rate paid on required and excess reserve balances at 0.10 percent, effective November 6, 2020.
As part of its policy decision, the Federal Open Market Committee voted to authorise and direct the Open Market Desk at the Federal Reserve Bank of New York, until instructed otherwise, to execute transactions in the System Open Market Account in accordance with the domestic policy directive (see directive in Implementation Note).
In a related action, the Board of Governors of the Federal Reserve System voted unanimously to approve the establishment of the primary credit rate at the existing level of 0.25 percent.

The Board of Governors of the Federal Reserve System voted unanimously to maintain the interest rate paid on required and excess reserve balances at 0.10 percent, effective July 30, 2020.

As part of its policy decision, the Federal Open Market Committee voted to authorize and direct the Open Market Desk at the Federal Reserve Bank of New York, until instructed otherwise, to execute transactions in the System Open Market Account

In a related action, the Board of Governors of the Federal Reserve System voted unanimously to approve the establishment of the primary credit rate at the existing level of 0.25 percent.

The information will be updated as appropriate to reflect decisions of the Federal Open Market Committee or the Board of Governors regarding details of the Federal Reserve's operational tools and approach used to implement monetary policy.

FOMC statement
Implementation note

29 July 2020: Federal Reserve Board announces extensions of U.S. dollar liquidity swap lines and repurchase agreement facility for foreign and international monetary authorities

The Federal Reserve announced the extensions of its temporary U.S. dollar liquidity swap lines and the temporary repurchase agreement facility for foreign and international monetary authorities (FIMA repo facility) through March 31, 2021. The extensions of the facilities will help sustain recent improvements in global U.S. dollar funding markets by maintaining these important liquidity backstops. In addition, the FIMA repo facility will help support the smooth functioning of the U.S. Treasury market by providing an alternative temporary source of U.S. dollars other than sales of securities in the open market.

Full press release

28 July 2020: Federal Reserve Board announces an extension of its lending facilities

The Federal Reserve Board announced an extension through December 31 of its lending facilities that were scheduled to expire on or around September 30. The three-month extension will facilitate planning by potential facility participants and provide certainty that the facilities will continue to be available to help the economy recover from the COVID-19 pandemic.

The extensions apply to the Primary Dealer Credit Facility, the Money Market Mutual Fund Liquidity Facility, the Primary Market Corporate Credit Facility, the Secondary Market Corporate Credit Facility, the Term Asset-Backed Securities Loan Facility, the Paycheck Protection Program Liquidity Facility, and the Main Street Lending Program. The Municipal Liquidity Facility is already set to expire on December 31, with the Commercial Paper Funding Facility set to expire on March 17, 2021. Further details on each can be found here.

Full press release

23 July 2020: Federal Reserve Board announces expansion of counterparties in the Term Asset-Backed Securities Loan Facility, Secondary Market Corporate Credit Facility, and Commercial Paper Funding Facility

The Federal Reserve Board broadened the set of firms eligible to transact with and provide services in three emergency lending facilities. Encouraging a broader range of agents for the Term Asset-Backed Securities Loan Facility (TALF) and counterparties for the Commercial Paper Funding Facility (CPFF) and Secondary Market Corporate Credit Facility (SMCCF) will increase the Federal Reserve's operational capacity and insight into the respective markets.

Full press release
Commercial Paper Funding Facility Term Sheet
Term Asset-Backed Securities Loan Facility
TALF, SMCCF, and CPFF Expanded Counterparty FAQs

7 July 2020: Federal Reserve releases minutes of the Board's discount rate meetings from May 18 through June 10, 2020

The Federal Reserve Board on Tuesday released the minutes of its interest rate meetings from May 18 through June 10, 2020.
Minutes

7 July 2020: Federal Reserve releases minutes of the Board's discount rate meetings from May 18 through June 10, 2020

The Federal Reserve Board on Tuesday released the minutes of its interest rate meetings from May 18 through June 10, 2020.

Minutes

1 July 2020: Federal reserve released minutes of Federal Open Market Committee, June 9-10, 2020

The Federal Reserve Board and the Federal Open Market Committee released the below minutes of the Committee meeting held on June 9–10, 2020. A summary of economic projections made by Federal Reserve Board members and Reserve Bank presidents for the meeting is also included as an addendum to these minutes.

Full press release
Minutes

29 June 2020: Federal Reserve Board releases new term sheet for the Primary Market Corporate Credit Facility

The Federal Reserve Board released a new term sheet for the Primary Market Corporate Credit Facility, adding pricing and other information. As detailed in the FAQs, pricing will be issuer-specific and informed by market conditions. Prices will also be subject to minimum and maximum spreads over comparable maturity Treasury securities.

By standing ready to provide credit to qualifying issuers of corporate bonds in periods of stress, the PMCCF serves as a funding backstop, supporting market liquidity and the availability of credit for large employers. The Primary Market and Secondary Market Corporate Credit Facilities were established with the approval of the Treasury Secretary and with $75 billion in equity provided by the Treasury Department from the CARES Act.

Full press release
Term Sheet: Primary Market Corporate Credit Facility
FAQs: Primary Market Corporate Credit Facility and Secondary Market Corporate Credit Facility

15 June 2020: Federal Reserve Board announces updates to Secondary Market Corporate Credit Facility (SMCCF)

The Federal Reserve Board announced updates to the Secondary Market Corporate Credit Facility (SMCCF), which will begin buying a broad and diversified portfolio of corporate bonds to support market liquidity and the availability of credit for large employers. As detailed in a revised term sheet and updated FAQs, the SMCCF will purchase corporate bonds to create a corporate bond portfolio that is based on a broad, diversified market index of U.S. corporate bonds.

Full press release

Term Sheet: Secondary Market Corporate Credit Facility

15 June 2020: Federal Reserve updates FAQs on Primary Market Corporate Credit Facility and Secondary Market Corporate Credit Facility

The Federal Reserve has updated its FAQs page addressing questions about the Primary Market Corporate Credit Facility (PMCCF) and the Secondary Market Corporate Credit Facility (SMCCF) (together, the CCFs).

The Federal Reserve may periodically update these FAQs and, therefore, please check the website for new FAQs or revisions to a previously issued FAQ.

12 June 2020: Federal Reserve releases Monetary Policy Report

The Federal Reserve have published its Monetary Policy Report, covering recent economic and financial developments, monetary policy, and a summary of economic projections. The Federal Reserve Act requires the Federal Reserve Board to submit written reports to Congress containing discussions of "the conduct of monetary policy and economic developments and prospects for the future."

10 June 2020: Federal Reserve issues FOMC statement

The ongoing public health crisis will weigh heavily on economic activity, employment, and inflation in the near term, and poses considerable risks to the economic outlook over the medium term. In light of these developments, the Committee decided to maintain the target range for the federal funds rate at 0 to 1/4 percent. The Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.

Full press release

10 June 2020: Federal Reserve Board and Federal Open Market Committee release economic projections from the June 9-10 FOMC meeting

The attached table and charts released on Wednesday summarize the economic projections and the target federal funds rate projections made by Federal Open Market Committee participants for the June 9-10 meeting.

See Projections (PDF)

20 May 2020: Minutes of the Federal Open Market Committee April 28–29, 2020 published

12 May 2020: Federal Reserve publishes updates to term sheet for the Term Asset-Backed Securities Loan Facility (TALF) and announces information to be disclosed monthly for TALF and Paycheck Protection Program Liquidity Facility

The Federal Reserve Board announced additional information regarding borrower and collateral eligibility criteria for the Term Asset-Backed Securities Loan Facility (TALF). The facility was announced on March 23 as part of an initiative to support the flow of credit to U.S. consumers and businesses. To help ensure that U.S. consumers and businesses remain able to access credit at affordable terms, TALF initially will make up to $100 billion of loans available.

Full press release

FAQs: Term Asset-Backed Securities Loan Facility

8 May 2020: Federal Reserve publishes Supervision and Regulation Report

The report summarizes banking conditions and the Federal Reserve’s supervisory and regulatory activities, in conjunction with semiannual testimony before Congress by the Vice Chairman for Supervision.

5 May 2020: Federal bank regulatory agencies modify LCR for banks participating in Money Market Mutual Fund Liquidity Facility and Paycheck Protection Program Liquidity Facility

To support the flow of credit to households and businesses, the federal bank regulatory agencies today announced an interim final rule that modifies the agencies' Liquidity Coverage Ratio (LCR) rule to support banking organizations' participation in the Federal Reserve's Money Market Mutual Fund Liquidity Facility and the Paycheck Protection Program Liquidity Facility. The rule is effective immediately and comments will be accepted for 30 days after publication in the Federal Register.

Full press release

29 April 2020: Federal Reserve issues FOMC statement and Implementation Note

The Federal Reserve will continue to purchase Treasury securities and agency residential and commercial mortgage-backed securities in the amounts needed to support smooth market functioning, thereby fostering effective transmission of monetary policy to broader financial conditions. In addition, the Open Market Desk will continue to offer large-scale overnight and term repurchase agreement operations.

Full statement

Full Implementation Note

23 April 2020: Federal Reserve Board announces temporary actions aimed at increasing the availability of intraday credit extended by Federal Reserve Banks

The Federal Reserve Board announced temporary actions aimed at increasing the availability of intraday credit extended by Federal Reserve Banks on both a collateralized and uncollateralized basis. Specifically, the Board is (1) suspending uncollateralized intraday credit limits (net debit caps) and is waiving overdraft fees for institutions that are eligible for the primary credit program; and (2) permitting a streamlined procedure for secondary credit institutions to request collateralized intraday credit (max caps). The temporary actions were applied immediately and will remain in effect until September 30, 2020, unless the Board communicates otherwise prior to that date.

Full press release

23 April 2020: Federal Reserve Board outlines the extensive and timely public information it will make available regarding its programs to support the flow of credit to households and businesses and thereby foster economic recovery

Building on its strong record of transparency and accountability around financial reporting and the policymaking process, the Federal Reserve Board outlined the extensive and timely public information it will make available regarding its programs to support the flow of credit to households and businesses and thereby foster economic recovery. Specifically, the Board will report substantial amounts of information on a monthly basis for the liquidity and lending facilities using Coronavirus Aid, Relief, and Economic Security, or CARES, Act funding.

Full press release

9 April 2020: Federal Reserve takes additional actions to provide up to $2.3 trillion in loans to support the economy

The Federal Reserve has taken additional actions to provide up to $2.3 trillion in loans to support the economy. The additional actions will increase flow of credit to households and businesses through capital markets, by expanding the size and scope of the Primary and Secondary Market Corporate Credit Facilities (PMCCF and SMCCF) as well as the Term Asset-Backed Securities Loan Facility (TALF), among other measures.

6 April 2020: New York Fed Opens Registration Process for Commercial Paper Funding Facility (CPFF)

The Federal Reserve Bank of New York opened the registration process for the Commercial Paper Funding Facility (CPFF). The CPFF will begin funding purchases of commercial paper on April 14, 2020.

6 April 2020: The Federal Reserve addresses questions about the Commercial Paper Funding Facility (updated from 25 March 2020)

In the format of a FAQs page the Federal Reserve explains the rationale for establishing the CPFF as well as its functionality. The Federal Reserve may periodically update these FAQs and, therefore, please check the website for new FAQs or revisions to a previously issued FAQ.

31 March 2020: Federal Reserve announces establishment of a temporary FIMA Repo Facility to help support the smooth functioning of financial markets

The Federal Reserve announced the establishment of a temporary repurchase agreement facility for foreign and international monetary authorities (FIMA Repo Facility) to help support the smooth functioning of financial markets, including the U.S. Treasury market, and thus maintain the supply of credit to U.S. households and businesses. The FIMA Repo Facility will allow FIMA account holders, which consist of central banks and other international monetary authorities with accounts at the Federal Reserve Bank of New York, to enter into repurchase agreements with the Federal Reserve. In these transactions, FIMA account holders temporarily exchange their U.S. Treasury securities held with the Federal Reserve for U.S. dollars, which can then be made available to institutions in their jurisdictions. The FIMA Repo Facility will be available beginning April 6 and will continue for at least 6 months.

25 March 2020: The Senate unanimously passed the Coronavirus Aid, relief, and Economic Security Act ('CARES Act')

The Senate has passed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which sets out a USD 2 trillion stimulus package including USD 500 billion in corporate liquidity from the Federal Reserve.

23 March 2020: Fed announces commitment to unlimited purchases of US Treasuries and agency MBS

The Federal Reserve commits to use its full range of tools to support the U.S. economy in this challenging time and thereby promote its maximum employment and price stability goals.

The Federal Open Market Committee is taking further actions to support the flow of credit to households and businesses by addressing strains in the markets for Treasury securities and agency mortgage-backed securities. The Federal Reserve will continue to purchase Treasury securities and agency mortgage-backed securities in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions. The Committee will include purchases of agency commercial mortgage-backed securities in its agency mortgage-backed security purchases.

In addition, the Open Market Desk will continue to offer large-scale overnight and term repurchase agreement operations. The Committee will continue to closely monitor market conditions, and will assess the appropriate pace of its securities purchases at future meetings.

23 March 2020: Fed announces extensive new measures to support the economy

In addition to the commitment to unlimited purchases of US Treasuries and agency MBS, the Fed also announces a package of additional measures. These inlcude:

Supporting the flow of credit to employers, consumers, and businesses by establishing new programs that, taken together, will provide up to $300 billion in new financing. The Department of the Treasury, using the Exchange Stabilization Fund (ESF), will provide $30 billion in equity to these facilities.

Establishment of two facilities to support credit to large employers – the Primary Market Corporate Credit Facility (PMCCF) for new bond and loan issuance and the Secondary Market Corporate Credit Facility (SMCCF) to provide liquidity for outstanding corporate bonds.
Establishment of a third facility, the Term Asset-Backed Securities Loan Facility (TALF), to support the flow of credit to consumers and businesses. The TALF will enable the issuance of asset-backed securities (ABS) backed by student loans, auto loans, credit card loans, loans guaranteed by the Small Business Administration (SBA), and certain other assets.
Facilitating the flow of credit to municipalities by expanding the Money Market Mutual Fund Liquidity Facility (MMLF) to include a wider range of securities, including municipal variable rate demand notes (VRDNs) and bank certificates of deposit.
Facilitating the flow of credit to municipalities by expanding the Commercial Paper Funding Facility (CPFF) to include high-quality, tax-exempt commercial paper as eligible securities. In addition, the pricing of the facility has been reduced.

18 March 2020: Fed announces establishment of a Money Market Mutual Fund Liquidity Facility (MMLF)

The Federal Reserve Board broadened its program of support for the flow of credit to households and businesses by taking steps to enhance the liquidity and functioning of crucial money markets. Through the establishment of a Money Market Mutual Fund Liquidity Facility, or MMLF, the Federal Reserve Bank of Boston will make loans available to eligible financial institutions secured by high-quality assets purchased by the financial institution from money market mutual funds.

17 March 2020: Fed announces establishment of a Primary Dealer Credit Facility (PDCF)

The Federal Reserve Board announced that it will establish a Primary Dealer Credit Facility, or PDCF, to support the credit needs of American households and businesses. The facility will allow primary dealers to support smooth market functioning and facilitate the availability of credit to businesses and households.

The PDCF will offer overnight and term funding with maturities up to 90 days and will be available on 20 March 2020. It will be in place for at least six months and may be extended as conditions warrant. Credit extended to primary dealers under this facility may be collateralized by a broad range of investment grade debt securities, including commercial paper and municipal bonds, and a broad range of equity securities. The interest rate charged will be the primary credit rate, or discount rate, at the Federal Reserve Bank of New York. More detailed terms and conditions and an operational calendar will be subsequently released.

17 March 2020: Fed announces establishment of a Commercial Paper Funding Facility (CPFF)

The Federal Reserve Board announced that it will establish a Commercial Paper Funding Facility (CPFF) to support the flow of credit to households and businesses. The CPFF will provide a liquidity backstop to U.S. issuers of commercial paper through a special purpose vehicle (SPV) that will purchase unsecured and asset-backed commercial paper rated A1/P1 (as of March 17, 2020) directly from eligible companies.

Please note that on 6 April 2020, the Federal Reserve published an extended revision of its FAQs page about the Commercial Paper Funding Facility.

15 March 2020: Fed announces actions to support the flow of credit to households and businesses

As well as cutting the primary credit rate for its discount window 150 basis points to 0.25% and a 100 basis point reduction in its target rate for federal funds to a range of 0% to 0.25%, the Fed encouraged more active use of the discount window, allowing depository institutions to borrow for periods up to 90 days, payable or renewable on a daily basis.

Furthermore, the Fed is encouraging depository institutions to utilize intraday credit extended by Reserve Banks, is encouraging banks to use their capital and liquidity buffers as they lend to households and businesses who are affected by the coronavirus, and has reduced reserve requirement ratios to zero percent effective on March 26, the beginning of the next reserve maintenance period.

15 March 2020: FOMC announces $500bn purchases of Treasuries and $200bn of MBS

Effective 16 March 2020, the Federal Open Market Committee (FOMC) directed the Open Market Trading Desk (the Desk) to increase over coming months the System Open Market Account (SOMA) holdings of Treasury securities and agency mortgage-backed securities (MBS) by at least $500 billion and at least $200 billion, respectively.  The FOMC instructed the Desk to conduct these purchases at a pace appropriate to support the smooth functioning of markets for Treasury securities and agency MBS. The FOMC also directed the Desk to continue rolling over at auction all principal payments from Treasury securities holdings and to reinvest all principal payments from agency debt and agency MBS holdings in agency MBS.

12 March 2020: NY Fed launches $500bn one-month and three-month repo operations

The Federal Reserve Bank of New York announced that its Open Market Trading Desk (the Desk) will offer $500 billion in a three-month repo operation settling on March 13, 2020. On March 13, the Desk will further offer $500 billion in a three-month repo operation and $500 billion in a one-month repo operation for same day settlement. Three-month and one-month repo operations for $500 billion will be offered on a weekly basis for the remainder of the monthly schedule. The Desk will continue to offer at least $175 billion in daily overnight repo operations and at least $45 billion in two-week term repo operations twice per week over this period.

            UK:

4 February 2021: Bank of England releases Monetary Policy Summary and minutes of the Monetary Policy Committee meeting

At its meeting ending on 3 February 2021, the Committee judged that the existing stance of monetary policy remains appropriate. The MPC voted unanimously to maintain Bank Rate at 0.1%.The Committee voted unanimously for the Bank of England to maintain the stock of sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, at £20 billion. The Committee voted unanimously for the Bank of England to continue with its existing programme of UK government bond purchases, financed by the issuance of central bank reserves, maintaining the target for the stock of these government bond purchases at £875 billion and so the total target stock of asset purchases at £895 billion.

Full press release
Monetary Policy Summary and minutes of MPC 3 February 2021

4 February 2021: Bank of England publishes market notice on Asset Purchase Facility: Gilt Purchases

On 3 February 2021 the MPC voted to maintain the target stock of purchased UK government bonds, financed by the issuance of central bank reserves, at £875 billion.

The market notice sets out details of the Bank’s planned APF gilt purchases taking place from the week commencing 8 February 2021 up to and including the week commencing 15 March 2021 – which is the week of the MPC’s March meeting. It covers the ongoing £150bn gilt purchases announced in November 2020 and the reinvestment of proceeds of a gilt maturity occurring on 22 January 2021 as set out in the December 2020 market notice.

The Bank intends to purchase evenly across the three gilt maturity sectors. For operations scheduled between 8 February 2021 and 17 March 2021 the planned size of auctions will be £1.48bn for each maturity sector. The range of gilts eligible for purchase will remain unchanged from previous operations.

28 January 2021: Bank of England publishes update on the Covid Corporate Financing Facility (CCFF) – Market Notice 9 October 2020

The Market Notice provides an update on how CCFF issuers’ credit quality will be monitored and reviewed in advance of the closure of the CCFF. It supplements, and should be read in conjunction with, the consolidated Market Notice dated 9 October 2020 and the Market Notice confirming the closure of the CCFF dated 22 September 2020. This Market Notice was originally published on 9 October 2020 and was updated on 28 January 2021 to provide further clarity of existing policy.

25 January 2021: Bank of England publishes Asset Purchase Facility Quarterly Report - 2020 Q4

The report contains information on the Bank of England’s Asset Purchase Facility (APF) for 2020 Q4, describing operations from 1 October 2020 to 31 December 2020. More information on what the APF is and what it does is available in our Market Operations Guide. A short timeline describing the history of the APF is provided as background at the end of the report.

During 2020 Q4 the APF made £48.6 billion of gilt purchases. Details of the purchase programme for the period can be found in the Market Notice published on 6 August 2020. The APF also made £0.1 billion of corporate bond purchases in 2020 Q4.

21 January 2021: Bank of England publishes minutes of Money Markets Committee meeting

The Bank of England published minutes of the Money Markets Committee meeting from 3 December 2020.

Full press release
Minutes

5 November 2020: Bank of England maintains Bank Rate at 0.1% - November 2020

At its meeting ending on 4 November 2020, the MPC voted unanimously to maintain Bank Rate at 0.1%. The Committee voted unanimously for the Bank of England to maintain the stock of sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, at £20 billion. The Committee voted unanimously for the Bank of England to continue with the existing programme of £100 billion of UK government bond purchases, financed by the issuance of central bank reserves, and also for the Bank of England to increase the target stock of purchased UK government bonds by an additional £150 billion, financed by the issuance of central bank reserves, to take the total stock of government bond purchases to £875 billion.

Full press release
Monetary Policy Summary and minutes

5 November 2020: Bank of England publishes Monetary Policy Report - November 2020

The Bank of England published its quarterly Monetary Policy Report, assessing the impact of Covid-19 on the economy in addition to the MPC’s latest projections on the UK financial system.

Full press release
Monetary Policy Report

26 October 2020: Bank of England publishes Asset Purchase Facility Quarterly Report - 2020 Q3

The report contains information on the Bank of England’s Asset Purchase Facility (APF) for Q3, from 1 July 2020 to 30 September 2020, describing the operations carried out during this period. More information on what the APF is and what it does is available in the Bank’s Market Operations Guide. A short timeline describing the history of the APF is provided as background at the end of the report.

During 2020 Q3 the APF made £73.3 billion of gilt purchases. Details of the purchase programme for this period can be found in the Market Notice published on 18 June 2020 and the Market Notice published on 13 August 2020. The APF also made £3.3 billion of corporate bond purchases in 2020 Q3. Further details can be found within the Market Notices published on 2 April 2020 and 1 May 2020.

9 October 2020: Bank of England publishes market notice on the Covid Corporate Financing Facility (CCFF)

The Market Notice provides an update on how CCFF issuers’ credit quality will be monitored and reviewed in advance of the closure of the CCFF. It supplements, and should be read in conjunction with, the consolidated Market Notice dated 3 August 2020 and the Market Notice confirming the closure of the CCFF dated 22 September 2020.

6 October 2020: Bank of England publishes minutes of Money Markets Committee meeting

The Bank of England published minutes of the Money Markets Committee meeting from 7 September 2020. The committee discussed market conditions and post-Covid changes in sterling money markets, among other items.

Full press release
Minutes

22 September 2020: Bank of England publishes market notice on the Covid Corporate Financing Facility (CCFF)

As indicated in the initial Market Notice of 18 March 2020 the CCFF was intended to operate for an initial period of 12 months. In line with this, and in light of current market conditions and recent usage patterns, the Bank and HM Treasury gave 6 months’ notice of the withdrawal of the facility. The CCFF will close for new purchases of CP from eligible issuers with effect from 23 March 2021. This means that the Facility will make no purchases of CP after 22 March 2021. The CCFF will also close to new applications from counterparties and issuers looking to become eligible on 31 December 2020.

17 September 2020: Bank of England publishes Monetary Policy Summary and minutes of Monetary Policy Committee meeting

At its meeting ending on 16 September 2020, the MPC voted unanimously to maintain Bank Rate at 0.1%. The Committee voted unanimously for the Bank of England to continue with its existing programmes of UK government bond and sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, maintaining the target for the total stock of these purchases at £745 billion.

Full press release
Monetary Policy Summary and minutes

6 August 2020: Bank of England maintains Bank Rate at 0.1% - August 2020

At its meeting ending on 4 August 2020, the MPC voted unanimously to maintain Bank Rate at 0.1%. The Committee voted unanimously for the Bank of England to continue with its existing programmes of UK government bond and sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, maintaining the target for the total stock of these purchases at £745 billion.

Full press release

6 August 2020: Bank of England publishes Monetary Policy Report and Financial Stability Report - August 2020

The Bank of England published its quarterly Monetary Policy Report alongside its Financial Stability Report, assessing the impact of Covid-19 on the economy in addition to the MPC’s latest projections and FPC assessment on the UK financial system.

Full press release
Monetary Policy Report - August 2020
Financial Stability Report - August 2020

6 August 2020: Bank of England publishes market notice on Asset Purchase Facility: Gilt Purchases

At its meeting ending on 4 August the MPC continued to expect the UK government bond asset purchase programme to be completed, and the total stock of purchases to reach £745 billion, around the turn of the year. The market notice sets out details of the Bank’s planned APF gilt purchases taking place from the week commencing 10 August 2020. It covers the completion of the purchases announced in June1, and the reinvestment of the proceeds of a gilt maturity occurring on 7 September 2020.

27 July 2020: Bank of England publishes Asset Purchase Facility Quarterly Report - 2020 Q2

The report contains information on the Bank of England’s Asset Purchase Facility (APF) for Q2 from 1 April 2020 to 30 June 2020. It describes the operations carried out during the period. More information on what the APF is and what it does is available in the Market Operations Guide. A short timeline describing the history of the APF is provided as background at the end of the report.

9 July 2020: Bank of England publishes minutes of Money Markets Committee meeting - 2 June 2020

The Money Markets Committee is a forum for market participants and authorities to discuss the UK unsecured deposits and funding market and securities lending and repo markets. The committee discussed market conditions and operational effectiveness during Covid-19, among other items.

Minutes

18 June 2020: Bank of England publishes market notice on Asset Purchase Facility (APF): Gilt Purchases

The Bank of England has outlined its plans of APF guilt purchasing from the week commencing 22 June 2020. It covers the completion of the purchases announced in March; the reinvestment of the proceeds of a gilt maturity occurring on 22 July 2020; and the commencement of the additional purchases announced at the MPC’s June meeting. For operations scheduled between 23 June 2020 and 6 August 2020 the size of each auction will be £1,151mn. This auction size includes the reinvestment of the £6.4bn cash flows associated with the maturity on 22 July 2020 of a gilt owned by the APF.

18 June 2020: Bank of England publishes Asset Purchase Facility Annual Report 2019/20

The Bank of England has published its Asset Purchase Facility Fund Limited Annual Report AND Accounts 2019/20.

18 June 2020: Bank of England releases Monetary Policy Summary and minutes of the Monetary Policy Committee meeting

The Bank of England’s Monetary Policy Committee (MPC) at its meeting ending on 17 June 2020, voted unanimously to maintain Bank Rate at 0.1%. The Committee voted unanimously for the Bank of England to continue with the existing programme of £200 billion of UK government bond and sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves. The Committee voted by a majority of 8-1 for the Bank of England to increase the target stock of purchased UK government bonds, financed by the issuance of central bank reserves, by an additional £100 billion, to take the total stock of asset purchases to £745 billion.

Full press release
Monetary Policy Summary and minutes of MPC 17 June 2020

5 June 2020: Bank of England publishes market notice on Asset Purchase Facility (APF): Pricing of CBPS eligible securities

The Bank of England updated the list of eligible securities for the Corporate Bond Purchase Scheme (CBPS) to include additional bonds with 3 months to maturity par call features.

Consistent with the scheme’s existing pricing approach, the Bank will continue to allocate and settle successful offers on a yield to maturity (YTM) basis. Participants should ensure that offers to sell any eligible security, including callable bonds, are submitted on a YTM basis.

22 May 2020: Bank of England publishes market notice with update on the Contingent Term Repo Facility (CTRF)

The Bank of England announced that, in light of more stable funding market conditions and recent usage patterns, it will discontinue 3-month CTRF operations at the end of May 2020. The final operation is scheduled to take place on 28 May.

The Bank will continue to offer 1-month term CTRF operations on a weekly basis at least through June 2020, with operations currently scheduled to end on 26 June. The Bank’s regular liquidity insurance facilities will continue to operate including the weekly 6-month Indexed Long-Term Repo (ILTR) and the on-demand Discount Window Facility (DWF). The indicative schedule of all the Bank’s market operations will be updated on the Information for participants page.

19 May 2020: HM Treasury and Bank of England publish joint Covid Corporate Financing Facility (CCFF) Market Notice

The Consolidated Market Notice describes the operation of HM Treasury and the Bank’s CCFF. It updates the currently effective provisions of previous Market Notices in relation to the CCFF and so replaces all previous Market Notices relevant to the facility. The CCFF will operate for as long as steps are needed to relieve cash flow pressures on firms that make a material contribution to the UK economy. The CCFF is operated by the Bank of England (the Bank) on behalf of HM Treasury.

19 May 2020: HM Treasury publishes details of an update to the terms of the Covid Corporate Financing Facility (CCFF)

Over 230 businesses are currently approved as eligible to access the CCFF. The facility has supported £18.8bnof lending to 55 businesses and authorised a further £38.8bn of potential lending including to another 68 businesses that make a significant contribution to the UK economy. The CCFF will continue to allow businesses that can demonstrate that they were in sound financial health as at 1 March 2020 to borrow from the Bank of England by issuing short-term commercial paper.

Full press release

7 May 2020: Bank of England maintains bank rate at 0.1%

MPC voted unanimously to maintain Bank Rate at 0.1%. The Committee voted by a majority of 7-2 for the Bank of England to continue with the programme of £200 billion of UK government bond and sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, to take the total stock of these purchases to £645 billion.

7 May 2020: Bank of England publishes Monetary Policy Report and Interim Financial Stability Report

The Bank published its quarterly Monetary Policy Report alongside an interim Financial Stability Report. Together, they provide a scenario for the path of the UK economy in the light of Covid-19 and assess the financial system’s resilience to that scenario.

Monetary Policy Report May 2020

Interim Financial Stability Report May 2020

2 May 2020: Bank of England publishes updates to TFSME to reflect HMT’s new Bounce Back Loans Scheme

The Bank of England announced a change to the Term Funding Scheme with additional incentives for SMEs (TFSME) to support HM Treasury’s Bounce Back Loans Scheme (BBLS). The TFSME allows eligible banks and building societies to access four-year funding at rates very close to Bank Rate.

Full press release

1 May 2020: Bank of England publish Market Notice on Asset Purchase Facility (APF) additional corporate bond purchases

The Market Notice describes the operation of the Bank of England’s Corporate Bond Purchase Scheme, covering eligible securities, eligible counterparties and applications, and its operating parameters. The Bank will publish on its website the list of eligible securities for the Scheme; the representative share for each sector; and the Banks’ holdings in each of these sectors on its website on the first Thursday of the month.

24 April 2020: Bank of England publishes market notice on extension of the Contingent Term Repo Facility (CTRF)

The Bank of England announced that it will continue to offer 3-month and 1-month term Contingent Term Repo Facility (CTRF) operations on a weekly basis through May 2020, with the final operation scheduled on 29 May.

22 April 2020: Bank of England publishes statement on increase to APF gilt lending limits

To further support gilt market functioning the Bank of England, working with the UK Debt Management Office (DMO), will increase the proportion of gilts held in the Asset Purchase Facility (APF) that are made available to the DMO to use in its market operations and for the DMO’s Standing and Special Repo Facilities.

20 April 2020: Bank of England addresses questions on the use of Liquidity and Capital Buffers

In the format of a FAQs page the Bank of England has provided further information on the usability of liquidity and capital buffers and their operation as set out in the PRA rules and guidelines and in response to the Covid-19 outbreak.

The Bank may periodically update these FAQs and, therefore, please check the website for new FAQs or revisions to a previously issued FAQ.

9 April 2020: PRA decides to maintain firms’ Systemic Risk Buffer (SRB) rates at the rate set in December 2019

In response to the economic shock from Covid-19, the Prudential Regulatory Authority (PRA), with the support of the FPC, announced its decision to maintain firms’ Systemic Risk Buffer (SRB) rates at the rate set in December 2019 and will next reassess them in Dec 2021.

See decision here

9 April 2020: PRA publishes Modification by consent of the calculation of the total exposure measure of the Leverage Ratio

The PRA is offering a modification by consent so that banks which are subject to the UK Leverage Ratio would be required to apply this article, for the purpose of PRA rules, if they choose to do so. Once a firm’s request for modification by consent takes effect, it will be required to calculate the exposure value of regular-way purchases and sales awaiting settlement in its UK Leverage Exposure Measure according to CRR2 Article 429g.

6 April 2020: Bank of England’s Term Funding Scheme to open 15 April 2020

The Bank of England announced the TFSME will open for drawings on 15 April 2020, sooner than previously anticipated. The TFSME allows eligible banks and building societies to access four-year funding at rates very close to Bank Rate.

Full press release

2 April 2020: Bank of England publishes Market Notice on Asset Purchase Facility (APF): Additional Corporate Bond Purchases

At its special meeting on 19 March 2020 the MPC judged that a further package of measures was warranted to meet its statutory objectives. In line with the MPC’s statement, the Bank intends to purchase at least £10 billion of eligible sterling non-financial corporate bonds in coming months, taking the stock of purchased corporate bonds to at least £20 billion. The Bank will keep the size of the Scheme and purchase pace under review in light of prevailing market conditions, market function and any future MPC decisions.

30 March 2020: Bank of England announces continuation of CTRF

The Bank of England announced that it will continue to offer the Contingent Term Repo Facility (CTRF) on a weekly basis through April 2020. 3-month term CTRF operations will continue to run weekly until 30 April. In addition, beginning this week there will also be a 1-month term CTRF operation each week, with the final operation scheduled on 1 May.

27 March 2020 (update from 20 March 2020): Bank of England addresses questions about the Covid Corporate Financing Facility (CCFF)

In the format of a FAQs page the Bank of England has provided further information for those seeking to participate in the CCFF scheme.

The Bank will accept CP with standard features that is issued using ICMA market standard documentation. ICMA is making generally available to non-ICMA members the Euro Commercial Paper materials from the ICMA Primary Market Handbook previously available only to ICMA members.

To support companies seeking to set up CP programmes quickly, the Bank will accept simplified versions of the commercial paper documentation, based on the ICMA standard, which are available on the Bank’s FAQ page (for ease of review, these are provided in clean and blackline to the ICMA recommended templates where appropriate).

The Bank may periodically update these FAQs and, therefore, please check the website for new FAQs or revisions to a previously issued FAQ.

24 March 2020: Bank of England launches Contingent Term Repo Facility (CTRF) and publishes CTRF Activation Market Notice

In response to financial market conditions the Bank of England has activated the Contingent Term Repo Facility (CTRF) - a temporary enhancement to its sterling liquidity insurance facilities. The CTRF is a flexible liquidity insurance tool that allows participants to borrow central bank reserves (cash) in exchange for other, less liquid assets (collateral).

The Bank’s liquidity insurance facilities support financial market functioning by providing market participants with predictable and reliable sources of liquidity as well as supporting financial stability by reducing the cost of disruption to critical financial services.

CTRF operations will run on 26 March 2020 and 2 April 2020, in addition to the Bank’s regular liquidity insurance facilities including the Indexed Long-Term Repo (ILTR) and Discount Window Facility (DWF).

The size of the CTRF operations will be unlimited, and the price will be a fixed rate of Bank Rate plus 15bps with a term of 3 months.

19 March 2020: MPC announces further rate cut and additional purchases of UK government and non-financial corporate bonds

At a special meeting on 19 March, the MPC judged that a further package of measures was warranted to meet its statutory objectives. It therefore voted unanimously to increase the Bank of England’s holdings of UK government bonds and sterling non-financial investment-grade corporate bonds by £200 billion to a total of £645 billion, financed by the issuance of central bank reserves.

The majority of additional asset purchases will comprise UK government bonds. The purchases will be completed as soon as is operationally possible, consistent with improved market functioning. The Bank will issue further guidance to the market in due course.

The MPC also voted unanimously to reduce the Bank Rate by 15 basis points to 0.10%. 

The Committee further voted unanimously that the Bank of England should enlarge the TFSME scheme, financed by the issuance of central bank reserves.

17 March 2020: HM Treasury and the Bank of England launch a Covid Corporate Financing Facility (CCFF)

The CCFF will provide funding to businesses by purchasing commercial paper of up to one-year maturity, issued by firms making a material contribution to the UK economy. It will help businesses across a range of sectors to pay wages and suppliers, even while experiencing severe disruption to cashflows.

The facility will offer financing on terms comparable to those prevailing in markets in the period before the COVID-19 economic shock, and will be open to firms that can demonstrate they were in sound financial health prior to the shock.  The facility will look through temporary impacts on firms’ balance sheets and cash flows by basing eligibility on firms’ credit ratings prior to the COVID-19 shock. Businesses do not need to have previously issued commercial paper in order to participate.

The scheme will operate for at least 12 months and for as long as steps are needed to relieve cash flow pressures on firms that make a material contribution to the UK economy. The Bank will publish further details of the operation of the CCFF in a Market Notice on Wednesday 18 March. The Bank will implement the facility on behalf of the Treasury and will put it into place as soon as possible.

By providing an alternative source of finance for a wide range of companies, the scheme will help to preserve the capacity of the banking system to lend to other companies, including small and medium-sized enterprises, which rely on banks.

11 March 2020: FPC releases the UK Countercyclical Capital Buffer

To support further the ability of banks to supply the credit needed to bridge a potentially challenging period, the Financial Policy Committee (FPC) has reduced the UK countercyclical capital buffer rate to 0% of banks’ exposures to UK borrowers with immediate effect. The rate had been 1% and had been due to reach 2% by December 2020.

The FPC expects to maintain the 0% rate for at least 12 months, so that any subsequent increase would not take effect until March 2022 at the earlies

The release of the countercyclical capital buffer will support up to £190 billion of bank lending to businesses. That is equivalent to 13 times banks’ net lending to businesses in 2019.

In addition, the Prudential Regulation Authority (PRA) has today set out its supervisory expectation that banks should not increase dividends or other distributions, such as bonuses, in response to these policy actions.

11 March 2020: MPC reduces Bank Rate and launches new Term Funding Scheme with additional incentives for SMEs

At its special meeting ending on 10 March 2020, the Monetary Policy Committee (MPC) voted unanimously to reduce Bank Rate by 50 basis points to 0.25%.  The MPC voted unanimously for the Bank of England to introduce a new Term Funding scheme with additional incentives for Small and Medium-sized Enterprises (TFSME), financed by the issuance of central bank reserves. The MPC voted unanimously to maintain the stock of sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, at £10 billion. The Committee also voted unanimously to maintain the stock of UK government bond purchases, financed by the issuance of central bank reserves, at £435 billion

            Switzerland:

17 December: SNB publishes monetary policy assessment

The Swiss National Bank (SNB) is maintaining its expansionary monetary policy with a view to stabilising economic activity and price developments. The SNB is keeping the SNB policy rate and interest on sight deposits at the SNB at −0.75%.

Full press release

24 September 2020: SNB publishes monetary policy assessment

The SNB is maintaining its expansionary monetary policy. In so doing, it aims to cushion the negative impact of the pandemic on economic activity and inflation. The SNB is keeping the SNB policy rate and interest on sight deposits at the SNB at −0.75%. In view of the fact that the Swiss franc is still highly valued, the SNB remains willing to intervene more strongly in the foreign exchange market, while taking the overall exchange rate situation into consideration. The SNB continues to supply the banking system with generous amounts of liquidity via the SNB COVID-19 refinancing facility (CRF). It is also active on the repo market as needed.

Full press release

18 June 2020: SNB releases Monetary Policy Assessment

The Swiss National Bank (SNB) released its Monetary Policy Assessment, acknowledging its expansionary monetary policy remains necessary to ensure appropriate monetary conditions in Switzerland. The SNB is keeping the SNB policy rate and interest on sight deposits at the SNB at −0.75%, and in light of the highly valued Swiss franc it remains willing to intervene more strongly in the foreign exchange market. In so doing, it takes the overall exchange rate situation into account. Furthermore, under the SNB COVID-19 refinancing facility (CRF), it is providing the banking system with additional liquidity and thus supporting the supply of credit to the economy at favourable terms.

Full press release

11 May 2020: SNB CRF expanded to include cantonal loan guarantees as well as joint and several loan guarantees for startups

The Swiss National Bank announced the expansion of accepted collateral for the COVID-19 refinancing facility (CRF). The CRF will now additionally accept claims secured by loan guarantees or credit default guarantees offered by cantons, provided these have been granted in order to cushion the economic impact of the COVID-19 pandemic.

Full press release

Instruction sheet on SNB COVID-19 refinancing facility (CRF)

25 March 2020: Swiss National Bank introduces new COVID-19 refinancing facility (CRF)

The Swiss National Bank (SNB) has introduced the new SNB COVID-19 refinancing facility (CRF). This measure is aimed at strengthening the supply of credit to the Swiss economy by providing the banking system with additional liquidity. There is no upper limit on the amounts available under the CRF, and drawdowns can be made at any time. The CRF operates in conjunction with the federal government’s guarantees for corporate loans. The facility allows banks to obtain liquidity from the SNB, which is secured by the federally guaranteed loans. The SNB thereby enables banks to expand their lending rapidly and on a large scale and, at the same time, to access the required liquidity. The interest rate for these refinancing transactions corresponds to the SNB policy rate. Under the CRF, the SNB can also conduct additional refinancing transactions in order to supply the banking system with further liquidity if required. The SNB has also submitted a proposal to the Federal Council requesting that the countercyclical capital buffer be reduced to 0% with immediate effect.

19 March 2020: SNB Monetary policy assessment Press Release

SNB maintains expansionary monetary policy, raises negative interest exemption threshold, and is examining additional steps

According to the SNB, it believes its expansionary monetary policy is more necessary than ever for ensuring appropriate monetary conditions in Switzerland. It is keeping the SNB policy rate and interest on sight deposits at the SNB at −0.75%. The SNB is intervening more strongly in the foreign exchange market to contribute to the stabilisation of the situation. In so doing, it takes the overall exchange rate situation into account. Negative interest and interventions are necessary to reduce the attractiveness of Swiss franc investments and thus counteract the upward pressure on the currency.

The SNB will also provide liquidity as part of the extended swap arrangements with other central banks, particularly in US dollars.

Finally the SNB is examining whether a relaxation of the countercyclical capital buffer would be possible despite the risks to the mortgage and real estate markets.

            Sweden

19 February 2021: Riksbank releases minutes of the monetary policy meeting held on 9 February 2021

At the Monetary Policy Meeting on 9 February, the Executive Board of the Riksbank decided to hold the repo rate unchanged at zero per cent. To provide support to the recovery and inflation, the Riksbank is also continuing to purchase assets within the envelope of SEK 700 billion and to offer liquidity within all the programmes launched in 2020.

Full press release
Minutes
See also: Monetary Policy Report, February 2021

10 February 2021: Riksbank publishes statement on asset purchases and zero interest rate

To facilitate the recovery and help inflation rise towards the target, monetary policy needs to remain expansionary. The Riksbank is therefore continuing to purchase assets within the envelope of SEK 700 billion. The repo rate is being left unchanged at zero per cent.

Full press release

7 December 2020: Riksbank releases minutes of the monetary policy meeting held on 25 November 2020

At the monetary policy meeting on 25 November, the Executive Board of the Riksbank decided to expand and extend the asset purchase programme from SEK 500 billion up to SEK 700 billion up until 31 December 2021 and to hold the repo rate unchanged at zero per cent.

Full press release

26 November 2020: Riksbank publishes statement on zero policy rate and extended asset purchases

The increased spread of infection and tighter restrictions will lead to a new downturn in the Swedish economy. To give further support in an uncertain time, improve the conditions for a recovery and help inflation rise towards the target of 2 per cent, the Executive Board has decided to expand and extend the Riksbank’s asset purchases from SEK 500 billion to up to SEK 700 billion up to 31 December 2021. The repo rate is held unchanged at zero per cent and is expected to remain at this level in the coming years.

Full press release

17 November 2020: Riksbank initiates corporate bond purchases via auctions and increases transparency

The Riksbank's purchases of corporate bonds have so far been made through a bilateral purchase procedure. On 2 December, the Riksbank will also begin purchasing corporate bonds via auctions. This means that the Riksbank's continued purchases will be made both through bilateral purchases and through auctions. Further information on the Riksbank’s corporate bond purchases via auctions can be found in the general terms and conditions on the Riksbank's website.

Full press release

1 October 2020: Riksbank releases minutes of the monetary policy meeting held on 21 September 2020

At the Monetary Policy Meeting on 21 September, the Executive Board of the Riksbank decided to hold the repo rate unchanged at zero per cent. The Riksbank’s zero policy rate and extensive programme of measures are providing continued support to economic developments and helping inflation rise towards the target.

Full press release

22 September 2020: Riksbank measures programme and low interest rate support the recovery

To provide support to economic developments and help inflation to rise towards the target, the Riksbank is continuing its asset purchases and offering liquidity in all the programmes launched so far this year. The repo rate is held unchanged at zero per cent and is expected to remain at this level in the coming years. The programmes have had a calming effect on financial markets and helped to keep interest rates to households and companies low in the crisis.

Full press release
Monetary policy report - September 2020

1 September 2020: Riksbank to begin purchasing corporate bonds in September

The Executive Board of the Riksbank has decided to initiate purchases of corporate bonds in the week beginning 14 September 2020. The purchases will keep companies’ funding costs down and reinforce the Riksbank’s capacity to act if the credit supply to companies were to deteriorate further as a result of the corona pandemic.

Full press release

10 July 2020: Riksbank publishes minutes of the Monetary Policy Meeting held on 30 June 2020

At the monetary policy meeting on 30 June, the Executive Board of the Riksbank decided on further monetary policy measures to alleviate the economic consequences of the pandemic and help the economy and inflation to recover. The framework for the asset purchases the Riksbank has been making since the beginning of the crisis is increased from SEK 300 billion to SEK 500 billion and the programme is extended to the end of June 2021. In September, the Riksbank will also begin purchasing corporate bonds. The Executive Board has further decided to cut interest rates and extend maturities on the lending to the banks. The repo rate was held unchanged at zero per cent.

Full press release

1 July 2020: Riksbank outlines further measures to alleviate the economic consequences of the pandemic

To avoid an unnecessarily prolonged and deep decline in the economy and inflation, the Executive Board has decided on several measures. The framework for the asset purchases made by the Riksbank since the crisis began is being extended from SEK 300 billion to SEK 500 billion up to the end of June 2021. In September, the Riksbank will also begin purchasing corporate bonds. The Executive Board has further decided to cut interest rates and extend maturities on lending to banks. At the same time, the repo rate is held unchanged at zero per cent.

Full press release

            China

27 August 2020: PBC announces CBS Operation

The People's Bank of China (PBC) conducted a central bank bills swap (CBS) operation on August 27, 2020 in order to improve the liquidity of bank-issued perpetual bonds, support banks to replenish capital through perpetual bond issuance, and enable the financial sector to better serve the real economy. The operation registered RMB5 billion, with a term of three months and a rate of 0.10 percent.

Full press release

Result of Central Bank Bills Swap (CBS) Operation No.8 [2020]

27 August 2020: PBC announces open market operations No.168 [2020]

In order to keep the liquidity in the banking system adequate at a reasonable level, the People’s Bank of China (PBC) conducted reverse repo operations in the amount of RMB100 billion through rate-bidding on August 27, 2020

Full press release

24 April 2020: PBOC conducts 56.1 billion yuan Targeted Medium-term Lending Facility operation

PBOC injected 56.1 billion yuan into the market via its Targeted Medium-term Lending Facility (TMLF). The facility has a maturity of one year and an interest rate of 2.95%, 20bps lower than 3.15%, the rate of the previous TMLF operation.

21 April 2020: PBOC conducts Central Bank Bills Swap

In order to improve the liquidity of FI perpetual bond market and support banks in issuing perpetual bonds to replenish capital and lend to the real economy, PBOC conducted a RMB 5 billion Central Bank Bills Swap on 21 April. The tenor was 3 months with a rate of 0.10%.

15 April 2020: PBOC monetary policy actions (in Chinese)

The People's Bank of China conducted a Medium-term Lending Facility (MLF) operation of 100 billion yuan, cutting the MLF rate by 20bps on 15 April.

On the same day, it lowered the deposit reserve requirement ratio (RRR) by 0.5% for rural financial institutions and urban commercial banks operating only in provincial administrative areas, implementing the first phase of its policy announced on 3 April. This first round of RRR adjustment for small and medium banks released about 200 billion yuan of long-term funds.

3 April 2020: PBOC reduces reserve requirements for small and medium banks

PBOC announced it will reduce the reserve requirement ratio (RRR) for small and medium banks on 15 April and 15 May, each time by 0.5%. This is expected to release RMB 400 billion in long-term funds. After the cut, the deposit reserve ratio for small and medium banks will be 6%. PBOC will also reduce the interest rate on excess reserves of FIs at the central bank from 0.72% to 0.35%, effective 7 April.

3 April 2020: Open market operation rate: 2.20% for 7-day

From 3 February 2020 to 31 March 2020, the People's Bank of China has conducted a total of more than 3.1 trillion yuan open market operations with reverse repo and its medium term lending facility to ensure sufficient liquidity supply.

25 March 2020: People’s Bank of China central bank bills swap
In order to improve the liquidity of FI perpetual bond market and support banks in issuing perpetual bonds to replenish capital and lend to the real economy, PBOC conducted a RMB 5 billion Central Bank Bills Swap. The tenor was 3 months and rate 0.10%. A similar operation was conducted on 28 February 2020.

13 March 2020: People’s Bank of China to implement targeted reserve requirement ratio (RRR) cuts for eligible banks

The measures, effective 16 March, are intended to release RMB 550 billion of long-term funds. Banks that meet certain criteria will be entitled to 50 to 100 basis points of RRR cuts. In addition, eligible joint-stock commercial banks will be given an additional targeted RRR cut of 100 basis points to support lending.

7 February 2020: PBOC conducted a RMB 1.7 trillion open market operation with reverse repo to ensure sufficient liquidity supply

Since early February, China regulators have introduced dozens of other interim measures in response to the effects of the coronavirus, those most relevant to the capital markets are:

NAFMII, Shanghai Stock Exchange, Shenzhen Stock Exchange have generally streamlined onshore bond approvals by facilitating online and remote applications. In Hubei province, corporate bond issuers have been allowed fast-track approvals.
CSRC (securities regulator) will allow more flexibility and potential extensions of deadlines for disclosure of listed companies; and in some cases reduce listing fees.

Hong Kong

22 April 2020: HKMA announces US Dollar Liquidity Facility

The Hong Kong Monetary Authority (HKMA) announced the introduction of a temporary US Dollar Liquidity Facility (the Facility) to make available US dollar liquidity assistance for licensed banks.

US dollar liquidity will be provided to licensed banks through competitive tenders in the form of repurchase transactions for a term of 7 days, settled on the day following the tender. Starting from 6 May 2020, the HKMA will conduct a tender every week (normally on Wednesday). he HKMA’s intention is to maintain the Facility until 30 September 2020, and will make a separate announcement if the end date changes.

Full press release

3 April 2020: HKMA letter to Authorised Institutions regarding liquidity measures in response to Covid-19 outbreak

HKMA sent a letter to Authorised Institutions outlining its liquidity measure response to COVID-19. To ensure the continued smooth operation of the interbank market and the banking system, HKMA has taken or plans to assist the industry in managing liquidity through its Liquidity Facilities Framework, the Federal Reserve’s Temporary FIMA Repo Facility, and supervisory expectation on the use of liquidity buffers under the liquidity coverage ratio (“LCR”) and liquidity maintenance ratio (“LMR”) regimes.

See full letter

16 March 2020: HKMA Announces Countercyclical Capital Buffer for Hong Kong

The Monetary Authority announced that the countercyclical capital buffer (CCyB) for Hong Kong is reduced from 2.0% to 1.0% with immediate effect.

Economic indicators and other relevant evidence have signaled that the economic environment in Hong Kong has deteriorated further since the novel coronavirus outbreak. The HKMA has been taking actions, including the establishment of the Banking Sector SME Lending Coordination Mechanism, to encourage the banking sector to continue supporting the financing need of SMEs in Hong Kong.

Lowering the countercyclical capital buffer at this juncture will allow banks to be more supportive to the domestic economy, in particular those sectors and individuals that are expected to experience additional short-term stress due to the impact arising from the outbreak.

Japan

18 December 2020: Bank of Japan releases Monetary Policy Statement

The Bank of Japan judged it appropriate to extend the duration of the Special Program to Support Financing in Response to the Novel Coronavirus (COVID-19) by 6 months and make adjustments to the program, with a view to continuing to support financing, mainly of firms. The Policy Board of the Bank decided upon (i) Additional purchases of CP and corporate bonds, and (ii) Special Funds-Supplying operations to facilitate financing in response to the Novel Coronavirus (COVID-19)

Key points of decisions made
Amendment to "Principal Terms and Conditions of the Special Funds-Supplying Operations to Facilitate Financing in Response to the Novel Coronavirus (COVID-19)"

29 October 2020: Bank of Japan releases Statement on Monetary Policy

The Bank of Japan released its latest Statement on Monetary Policy following its Policy Board meeting. The Bank will maintain a negative short-term policy interest rate of minus 0.1 percent to the Policy-Rate Balances in current accounts held by financial institutions at the Bank. Regarding the long-term interest rate, the Bank will purchase a necessary amount of Japanese government bonds (JGBs) without setting an upper limit so that 10-year JGB yields will remain at around zero percent.
17 September 2020: Bank of Japan releases Statement on Monetary Policy
The Bank of Japan released its latest Statement on Monetary Policy following its meeting held on 17 September 2020. The Bank will maintain a negative short-term policy interest rate of minus 0.1 percent to the Policy-Rate Balances in current accounts held by financial institutions at the Bank. Regarding the long-term interest rate, the Bank will purchase a necessary amount of Japanese government bonds (JGBs) without setting an upper limit so that 10-year JGB yields will remain at around zero percent.

15 July 2020: Bank of Japan releases Statement on Monetary Policy

The Bank of Japan released its latest Statement on Monetary Policy following its meeting held on 15 July 2020. The Bank will maintain a negative short-term policy interest rate of minus 0.1 percent to the Policy-Rate Balances in current accounts held by financial institutions at the Bank, among other decisions.

16 June 2020: Bank of Japan releases Statement on Monetary Policy and summary of measures in response to COVID-19

At the Monetary Policy Meeting held recently, the Policy Board of the Bank of Japan decided to set the short-term policy interest rate minus 0.1 percent to the Policy-Rate Balances in current accounts held by financial institutions at the Bank, and purchase a necessary amount of Japanese government bonds (JGBs) without setting an upper limit so that 10-year JGB yields will remain at around zero percent, among other items.

Statement on Monetary Policy

BOJ’s Measures in Response to COVID-19

22 May 2020: Bank of Japan releases Monetary Policy Statement

The Policy Board of the Bank of Japan published its guidelines for market operations and asset purchases, including additional CP and corporate bond purchases with the upper limit of the amounts outstanding of 7.5 trillion yen for each asset.

27 April 2020: Bank of Japan announces Enhancement of Monetary Easing

The Bank of Japan announced further monetary easing through (1) an increase in purchases of CP and corporate bonds, (2) strengthening of the Special Funds-Supplying Operations to Facilitate Financing in Response to the Novel Coronavirus (COVID-19), and (3) further active purchases of Japanese government bonds (JGBs) and treasury discount bills (T-Bills). The Bank will take these measures with a view to doing its utmost to ensure smooth financing, such as of financial institutions and firms,and maintaining stability in financial markets.

Full press release

24 March 2020: Bank of Japan announces additional measures to maintain stability of the repo market

In addition to the market operations announcement 13 March 2020, the BoJ released a statement on further measures implemented to maintain stability of the repo market. These include an extension of the implementation period for increasing the number of Japanese government securities (JGS) issues offered in the Securities Lending Facility (SLF) and a relaxation of the upper limit on the number of JGS issues allowed for the submission of bids for the SLF.

16 March 2020: Enhancement of Monetary Easing in Light of the Impact of the Outbreak of the Novel Coronavirus (COVID-19)

The Bank of Japan judged appropriate to enhance monetary easing through (1) the further ample supply of funds by conducting various operations including purchases of Japanese government bonds (JGBs) and the U.S. dollar funds-supplying operations, (2) measures to facilitate corporate financing including the introduction of a new operation, and (3) active purchases of exchange-traded funds (ETFs) and Japan real estate investment trusts (J-REITs). The Bank will take these measures with a view to doing its utmost to ensure smooth corporate financing and maintaining stability in financial markets, thereby preventing firms' and households' sentiment from deteriorating.

The measures to facilitate corporate financing include

The Introduction of the Special Funds-Supplying Operations to Facilitate Corporate Financing regarding the Novel Coronavirus (COVID-19)
The Bank decided, by a unanimous vote, to introduce a new operation to provide loans against corporate debt (of about 8 trillion yen as of end-February 2020) as collateral at the interest rate of 0 percent with maturity up to one year. Twice as much as the amount outstanding of the loans will be included in the Macro Add-on Balances in current accounts held by financial institutions at the Bank. This operation will be conducted until the end of September 2020.
Increase in purchases of CP and corporate bonds

13 March 2020: Bank of Japan announces market operations measures for end of March period

Considering the recent unstable movements in global financial and capital markets, the Bank of Japan announced its plans for the provision of ample liquidity and maintaining stability of the repo market.

Australia

2 February 2021: RBA publishes Monetary Policy Statement

At its meeting, the Board decided to maintain the targets of 10 basis points for the cash rate and the yield on the 3-year Australian Government bond, as well as the parameters of the Term Funding Facility. It also decided to purchase an additional $100 billion of bonds issued by the Australian Government and states and territories when the current bond purchase program is completed in mid-April. These additional purchases will be at the current rate of $5 billion a week.

1 December 2020: RBA publishes Monetary Policy Statement

At its meeting, the Board decided to maintain the current policy settings, including the targets of 10 basis points for the cash rate and the yield on 3-year Australian Government bonds, as well as the parameters of the Term Funding Facility and the government bond purchase program.

Full press release

3 November 2020: RBA publishes Monetary Policy Statement

At its meeting, the Board decided on a package of further measures to support job creation and the recovery of the Australian economy from the pandemic. The elements of the package are as follows:

a reduction in the cash rate target to 0.1 per cent
a reduction in the target for the yield on the 3-year Australian Government bond to around 0.1 per cent
a reduction in the interest rate on new drawings under the Term Funding Facility to 0.1 per cent
a reduction in the interest rate on Exchange Settlement balances to zero
the purchase of $100 billion of government bonds of maturities of around 5 to 10 years over the next six months.

Under the program to purchase longer-dated bonds, the Bank will buy bonds issued by the Australian Government and by the states and territories, with an expected 80/20 split. These bonds will be bought in the secondary market through regular auctions, with the first auction to be held Thursday 5 November for Australian Government securities. Further details of the auctions are provided in the accompanying market notice. The Bank remains prepared to purchase bonds in whatever quantity is required to achieve the 3-year yield target. Any bonds purchased to support this target would be in addition to the $100 billion bond purchase program.

Full press release
Reserve Bank Purchases of Government Securities
Term Funding Facility – Reduction in Interest Rate to Further Support the Australian Economy

6 October 2020: RBA publishes Monetary Policy Statement

At its meeting, the Board decided to maintain the current policy settings, including the targets for the cash rate, the yield on 3-year Australian Government bonds, and the parameters for the expanded Term Funding Facility.

Government bond markets are functioning well, alongside a significant increase in issuance. Bond yields are around record lows. Early in September, the Bank bought a further $2 billion of Australian Government Securities (AGS) in support of its 3-year yield target, bringing total purchases of government securities since March to $63 billion. Over the past couple of weeks, 3-year yields have fallen to around 18 basis points as markets price in some probability of further monetary policy easing.

Full press release

1 September 2020: RBA publishes Monetary Policy Statement

At its meeting, the Board decided to maintain the targets for the cash rate and the yield on 3-year Australian Government bonds of 25 basis points. It also decided to increase the size of the Term Funding Facility and make the facility available for longer.

Under the expanded Term Funding Facility, authorised deposit-taking institutions (ADIs) will have access to additional funding, equivalent to 2 per cent of their outstanding credit, at a fixed rate of 25 basis points for three years. ADIs will be able to draw on this extra funding up until the end of June 2021.

Full press release
Term Funding Facility Increase and Extension to Further Support the Australian Economy

4 August 2020: RBA releases Monetary Policy Statement

At its meeting, the Board decided to maintain the current policy settings, including the targets for the cash rate and the yield on 3-year Australian Government bonds of 25 basis points.

The RBA will purchase AGS in the secondary market on 5 August 2020 to ensure that the yield on 3-year bonds remains consistent with this target. Further purchases will be undertaken as necessary. The yield target will remain in place until progress is being made towards the goals for full employment and inflation.

Full press release

11 June 2020: ASIC releases Interim Corporate Plan 2020-2021: Strategic priorities responding to the impact of the COVID-19 pandemic

ASIC released its Corporate Plan 2020-2021 outlining its strategic change program and key priorities, including protecting consumers from harm at a time of heightened vulnerability, maintaining financial system resilience and stability and supporting Australian businesses to respond to the effects of the COVID-19 pandemic among others.

2 June 2020: RBA releases statement by Philip Lowe, Governor: Monetary Policy Decision

The RBA Board decided to maintain the current policy settings, including the targets for the cash rate and the yield on 3-year Australian Government bonds of 25 basis points. The Bank has purchased government bonds on only one occasion since the previous Board meeting, with total purchases to date of around $50 billion. The Bank is prepared to scale-up its bond purchases again and will do whatever is necessary to ensure bond markets remain functional and to achieve the yield target for 3-year AGS. The target will remain in place until progress is being made towards the goals for full employment and inflation.

Full press release

5 May 2020: RBA broadens eligibility of corporate debt securities as collateral for domestic market operations

To assist with the smooth functioning of Australian capital markets, the Reserve Bank has broadened the range of corporate debt securities that are eligible as collateral for domestic market operations to investment grade. The eligibility of corporate debt securities for purchase by the Reserve Bank under a repurchase agreement (repo) remains subject to an approval process, as with all securities except Australian Government and semi government securities.

Eligible Securities

19 March 2020: Reserve Bank of Australia announces comprehensive package to support the Australian economy

A reduction in the cash rate target to 0.25 per cent.
A target for the yield on 3-year Australian Government bonds of around 0.25 per cent.
A term funding facility for the banking system, with particular support for credit to small and medium-sized businesses.
Exchange settlement balances at the Reserve Bank will be remunerated at 10 basis points, rather than zero as would have been the case under the previous arrangements.

The Reserve Bank will also continue to provide liquidity to Australian financial markets by conducting one-month and three-month repo operations in its daily market operations until further notice. In addition, the Bank will conduct longer-term repo operations of six-month maturity or longer at least weekly, as long as market conditions warrant.

New Zealand

11 November 2020: RBNZ releases Monetary Policy Statement and MPC meeting notes

The Monetary Policy Committee agreed to provide additional monetary stimulus to the economy in order to meet its consumer price inflation and employment remit. The Committee agreed that the additional stimulus would be provided through a Funding for Lending Programme (FLP), commencing in December. The FLP will reduce banks’ funding costs and lower interest rates.

The Committee will also continue with the Large Scale Asset Purchase (LSAP) Programme up to $100 billion, and retain the Official Cash Rate (OCR) at 0.25 percent in accordance with the guidance issued on 16 March.

Full press release
Monetary Policy Statement
Large Scale Asset Purchase Programme - Indicative schedule for week beginning 16 November 2020

23 September 2020: RBNZ MPC meeting: Prolonged monetary support necessary

The Monetary Policy Committee agreed to continue with the Large Scale Asset Purchase (LSAP) Programme up to $100 billion. This action is necessary to further lower household and business borrowing rates in order to achieve the Committee’s inflation and employment remit. The Official Cash Rate (OCR) is being held at 0.25 percent in accordance with the guidance issued on 16 March.

Full press release

20 August 2020: RBNZ publishes changes to Term Lending Facility

In conjunction with the Government’s review of the Business Finance Guarantee Scheme, the Reserve Bank outlined the revised operational details of the Term Lending Facility (TLF). Under the revised facility, the Reserve Bank will continue to offer to lend funds to banks at the Official Cash Rate, however the term has been extended to five years from three years. The new facility will be available to use from 26 August and now runs through to 1 February 2021.

Full press release
Reserve Bank outlines details of revised Term Lending Facility - Domestic Markets press release
TLF Terms

12 August 2020: RBNZ releases Monetary Policy Statement August 2020 and meeting minutes

The Monetary Policy Committee agreed to expand the Large Scale Asset Purchase (LSAP) programme up to $100 billion so as to further lower retail interest rates in order to achieve its remit. The eligible assets remain the same and the Official Cash Rate (OCR) is being held at 0.25 percent in accordance with the guidance issued on 16 March.

Reflecting a possible need for further monetary stimulus, the Committee also agreed that a package of additional monetary instruments must remain in active preparation. The deployment of such tools will depend on the outlook for inflation and employment. The package of further instruments includes a negative OCR supported by funding retail banks directly at near-OCR (a Funding for Lending Programme). Purchases of foreign assets also remain an option.

August 2020 Monetary Policy Statement
Further easing in monetary policy delivered
August 2020 Monetary Policy Statement briefing

24 June 2020: Monetary Policy easing to continue

The Monetary Policy Committee agreed to continue with the Large Scale Asset Purchase (LSAP) programme aimed at keeping interest rates low for the foreseeable future. The LSAP quantum remains set at $60 billion. The assets included are New Zealand Government Bonds, Local Government Funding Agency Bonds, and NZ Government Inflation-Indexed Bonds. The Committee is committed to reviewing this quantum at regular intervals, with a focus on achieving its remit. The Official Cash Rate (OCR) is being held at 0.25 percent in accordance with the guidance issued on 16 March.

Full press release

13 May 2020: RBNZ expands Large Scale Asset Purchases

The Monetary Policy Committee agreed to significantly expand the Large Scale Asset Purchase (LSAP) programme potential to $60 billion, up from the previous $33 billion limit. The LSAP programme includes NZ Government Bonds, Local Government Funding Agency Bonds and, now, NZ Government Inflation-Indexed Bonds.

4 May 2020: RBNZ publishes details on Term Lending Facility

The Reserve Bank will provide term funding to banks at a very low interest rate under the previously announced (2 April 2020) Term Lending Facility (TLF), to help them support the Government’s Business Finance Guarantee Scheme and promote lending to businesses. The Reserve Bank outlined the operational details of the TLF, which will be available to banks from 26 May. Under the facility, the Reserve Bank will offer to lend funds to banks at the Official Cash Rate of 0.25 percent, fixed for three years.

2 April 2020: RBNZ introduces longer-term funding to support business lending

The Reserve Bank is introducing a Term Lending Facility (TLF), a new longer-term funding scheme for the banking system, in support of the Government’s Business Finance Guarantee Scheme to help promote lending to businesses. The TLF is similar to the recently announced, Term Auction Facility (TAF), and both provide liquidity to the banking system. The TLF aims to complement the Government’s Business Finance Guarantee Scheme, announced last week, by ensuring access to funding for banks at low interest rates for up to 3 years duration, which is longer than the Bank’s other liquidity facilities.

23 March 2020: RBNZ to implement $30bn Large Scale Asset Purchase Programme of NZ Govt Bonds

20 March 2020: Reserve Bank of New Zealand measures to provide additional support to domestic markets

Regular market operations continue to ensure there is ample liquidity in the financial system.

The Term Auction Facility (TAF) is a program that will alleviate pressures in funding markets. The TAF gives banks the ability to access term funding, with collateralised loans available out to a term of 12 months.

The Reserve Bank is providing liquidity in the FX swap market, to ensure this form of funding can be accessed at rates near the Official Cash Rate (OCR).

The Reserve Bank has re-established a temporary USD swap line with the US Federal Reserve. This will support the provision of USD liquidity to the New Zealand market, in an amount up to USD 30 billion. This is a facility that is being offered to many other central banks globally.

The Reserve Bank has been providing liquidity to the New Zealand government bond market to support market functioning.

India

22 February 2021: RBI releases minutes of the Monetary Policy Committee meeting February 3-5, 2021

The Reserve Bank of India released the minutes from the twenty seventh meeting of the Monetary Policy Committee (MPC), February 3-5, 2021. On the basis of an assessment of the current and evolving macroeconomic situation, the MPC decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4.0 per cent. Consequently, the reverse repo rate under the LAF remains unchanged at 3.35 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 4.25 per cent.

Full press release

5 February 2021: RBI releases Monetary Policy Statement, 2020-21 Resolution of the Monetary Policy Committee (MPC) February 3-5, 2021

On the basis of an assessment of the current and evolving macroeconomic situation, the Monetary Policy Committee (MPC) at its meeting decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4.0 per cent. Consequently, the reverse repo rate under the LAF remains unchanged at 3.35 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 4.25 per cent.

Governor’s Statement, February 5, 2021

11 December 2020: RBI Announces Special Open Market Operations (OMO) Simultaneous Purchase and Sale of Government of India Securities

On a review of current liquidity and financial conditions, the Reserve Bank decided to conduct simultaneous purchase and sale of government securities under Open Market Operations (OMO) for an aggregate amount of ₹10,000 crores each on December 17, 2020.

Full press release

4 December 2020: RBI releases Monetary Policy Statement, 2020-21 Resolution of the Monetary Policy Committee (MPC) December 2-4, 2020

On the basis of an assessment of the current and evolving macroeconomic situation, the Monetary Policy Committee (MPC) at its meeting decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4.0 per cent. Consequently, the reverse repo rate under the LAF remains unchanged at 3.35 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 4.25 per cent.

Full press release

2 November 2020: RBI Increases Market Trading Hours

The trading hours for various markets regulated by the Reserve Bank were amended effective from April 7, 2020 in view of the operational dislocations and elevated levels of health risks posed by COVID-19. With the graded roll-back of the lockdown and easing of restrictions on movement of people and functioning of offices, it has been decided to restore trading hours for regulated markets in a phased manner. See the RBI press release for full list of revised amended timings.

Full press release

23 October 2020: RBI releases minutes of the Monetary Policy Committee meeting October 7 to 9, 2020

The Reserve Bank of India released the minutes from the twenty fifth meeting of the Monetary Policy Committee (MPC), October 7 to 9, 2020. On the basis of an assessment of the current and evolving macroeconomic situation, the MPC decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4.0 per cent. Consequently, the reverse repo rate under the LAF remains unchanged at 3.35 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 4.25 per cent.

9 October 2020: RBI publishes Monetary Policy Statement, 2020-21 Resolution of the Monetary Policy Committee (MPC) October 7-9, 2020

On the basis of an assessment of the current and evolving macroeconomic situation, the Monetary Policy Committee (MPC) at its meeting (October 9, 2020) decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4.0 per cent. Consequently, the reverse repo rate under the LAF remains unchanged at 3.35 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 4.25 per cent.

25 August 2020: RBI announces special Open Market Operations (OMOs) of simultaneous purchase and sale of Government of India Securities

On a review of current and evolving liquidity and market conditions, the Reserve Bank decided to conduct simultaneous purchase and sale of government securities under Open Market Operation (OMO) for an aggregate amount of ₹20,000 crores in two tranches of ₹10,000 crores each. The auctions would be conducted on August 27, 2020 and September 03, 2020.

Full press release

20 August 2020: RBI publishes minutes of Monetary Policy Committee Meeting August 4 to 6, 2020

The Reserve Bank of India (RBI) published the meeting minutes of the twenty fourth meeting of the Monetary Policy Committee (MPC) from August 4 to 6, 2020.

Full press release

6 August 2020: RBI Monetary Policy Statement, 2020-2021

On the basis of an assessment of the current and evolving macroeconomic situation, the RBI Monetary Policy Committee (MPC) at its meeting today (August 6, 2020) decided to:

keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4.0 per cent.
Consequently, the reverse repo rate under the LAF remains unchanged at 3.35 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 4.25 per cent.
The MPC also decided to continue with the accommodative stance as long as it is necessary to revive growth and mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target going forward.

Governor’s Statement – August 6, 2020

29 June 2020: RBI Announces Special Open Market Operations (OMO) of Simultaneous Purchase and Sale of Government of India Securities

On a review of current and evolving liquidity and market conditions, the Reserve Bank decided to conduct simultaneous purchase and sale of government securities under Open Market Operations (OMO) for ₹10,000 crores each on July 02, 2020. Further details of the securities within press release.

Full press release

23 May 2020: RBI publishes COVID-19 Regulatory Package and updated Review of Resolution Timelines under the Prudential Framework on Resolution of Stressed Assets

COVID-19 – Regulatory Package

Review of Resolution Timelines under the Prudential Framework on Resolution of Stressed Assets

22 May 2020: RBI releases Monetary Policy Statement 2020-2021

On the basis of an assessment of the current and evolving macroeconomic situation, the Monetary Policy Committee (MPC) at its meeting on 22 May 2020 decided to:

reduce the policy repo rate under the liquidity adjustment facility (LAF) by 40 bps to 4.0 per cent from 4.40 per cent with immediate effect (see separate press release);
accordingly, the marginal standing facility (MSF) rate and the Bank Rate stand reduced to 4.25 per cent from 4.65 per cent (separate press release); and
the reverse repo rate under the LAF stands reduced to 3.35 per cent from 3.75 per cent (separate press release).
The MPC also decided to continue with the accommodative stance as long as it is necessary to revive growth and mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target.

These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth.

30 April 2020: RBI extends truncated market hours until further notice

In view of persisting operational dislocations and elevated levels of health risks warranting continuing restrictions on movement, work from home arrangements and business continuity plans, it has been decided that the amended trading hours i.e., from 10.00 am to 2.00 pm for RBI-regulated markets that were effective till the close of business on Thursday April 30, 2020 vide press release of 16 April 2020 shall be extended till further notice.

Full press release

30 April 2020: RBI extends Fixed Rate Reverse Repo and MSF window

Reserve Bank had vide Press Release 2019-2020/2147 dated March 30, 2020 extended the window timings of Fixed Rate Reverse Repo and MSF operations. In view of the continuing disruptions caused by COVID-19, it has been decided to continue with the revised timings till further notice.

Full press release

30 April 2020: RBI Extends Regulatory Benefits under SLF-MF Scheme

RBI announced the regulatory benefits under the SLF-MF scheme, initially announced 27 April 2020, will be extended to all banks. Banks meeting the liquidity requirements of MFs by (1) extending loans, and (2) undertaking outright purchase of and/or repos against the collateral of investment grade corporate bonds, commercial paper (CPs), debentures and certificates of deposit (CDs) held by MFs will be eligible to claim all the regulatory benefits available under SLF-MF scheme without the need to avail back to back funding from the Reserve Bank under the SLF-MF.

Full press release

17 April 2020: Reserve Bank of India COVID19 Regulatory Package - Asset Classification and Provisioning

Full press release

17 April 2020: Reserve Bank of India COVID19 Regulatory Package – Review of Resolution Timelines under the Prudential Framework on Resolution of Stressed Assets

Full press release

17 April 2020: Reserve Bank of India releases Governor’s statement of measures taken in context of COVID-19

Full statement

16 April 2020: RBI extends market hours amendments to 30 April 2020

In view of the Government of India’s order that the lockdown will continue to be in force till May 3, 2020 (Sunday), it was decided the amended trading hours for various RBI regulated markets will continue to be effective till the close of business on Thursday April 30, 2020.

In an earlier press release (3 April 2020), the RBI revised trading hours to four hours for various markets in order to minimise market liquidity and volatility risks and to ensure that market participants maintain adequate checks and supervisory controls while optimising thin resources and ensuring safety of personnel.

Full press release

27 March 2020: The RBI published a statement on developmental and regulatory policies

The RBI Statement sets out various developmental and regulatory policies that directly address the stress in financial conditions caused by COVID-19. They consist of:

expanding liquidity in the system sizeably to ensure that financial markets and institutions are able to function normally in the face of COVID-related dislocations;
reinforcing monetary transmission so that bank credit flows on easier terms are sustained to those who have been affected by the pandemic;
easing financial stress caused by COVID-19 disruptions by relaxing repayment pressures and improving access to working capital; and
improving the functioning of markets in view of the high volatility experienced with the onset and spread of the pandemic. The policy initiatives in this section should be read in conjunction with the MPC’s decision on monetary policy actions and stance in its resolution.

20 March 2020: Reserve Bank of India Announces OMO Purchase of Government of India Dated Securities

On a review of the current liquidity and financial conditions, the Reserve Bank has decided to conduct purchase of Government securities under Open Market Operations (OMOs) for an aggregate amount of ₹30,000 crores in two tranches of ₹15,000 crores each in the month of March 2020.

            Indonesia

17 June 2020: Bank Indonesia publishes Monetary Policy Report Quarter I 2020

Bank Indonesia (BI) released its Monetary Policy Report for Quarter 1 2020, outlining the impact of the COVID-19 pandemic on the Indonesian economy and BI’s response through various policy measures. Namely, BI lowered the monetary policy rate (BI7DRR) by 25bps in February and March 2020 to 4.5%, and BI Board of Governors agreed on 18th and 19th May 2020 to hold the BI 7-Day Reverse Repo Rate at 4.50% while also maintaining the Deposit Facility (DF) and Lending Facility (LF) rates at 3.75% and 5.25% respectively.

Press release

Full report

14 April 2020: Bank Indonesia 7-Day Reverse Repo Rate Held at 4,50%, Rupiah Reserve Requirement Lowered by 200 bps: Strengthening Sinergy to Mitigate The Risk of COVID-19

The BI Board of Governors agreed on 13th and 14th April 2020 to hold the BI 7-Day Reverse Repo Rate at 4.50%, while also maintaining the Deposit Facility (DF) and Lending Facility (LF) rates at 3.75% and 5.25%.

1 April 2020: Bank Indonesia communication on Economic Stimulus: Mitigating COVID-19 Impact

Full press release

31 March 2020: Bank Indonesia Amends Rupiah and Foreign Currency Reserve Requirements

Bank Indonesia has amended regulations concerning Rupiah and Foreign Currency Reserve Requirements through Bank Indonesia Regulation (PBI) No. 22/3/PBI/2020, as an amendment to Bank Indonesia Regulation (PBI) No. 20/3/PBI/2018 concerning Statutory Reserve Requirements in Rupiah and a Foreign Currency for Conventional Commercial Banks, Islamic Banks and Islamic Business Units, effective from 26th March 2020.

Full press release

19 March 2020: Bank Indonesia 7-Day Reverse Repo Rate Lowered 25 bps to 4,50%: Maintaining Stability, Mitigating The Risk of COVID-19

The BI Board of Governors agreed on 18 and 19 March 2020 to lower the BI 7-day Reverse Repo Rate by 25 bps to 4,50%, Deposit Facility (DF) rates lowered 25 bps to 3,75% and Lending Facility (LF) rates lowered 25 bps to 5,25%. In addition, BI has adopted several policy measures to mitigate the risk of COVID-19.

            Philippines

24 March 2020: BSP cuts RRR by 200 bps to boost domestic liquidity

The 200 bps reduction in the reserve requirement ratio of reservable liabilities of universal and commercial banks will be effective 30 March 2020.

The RR cut is intended to calm the markets and to encourage banks to continue lending to both retail and corporate sectors. This will ensure sufficient domestic liquidity in support of economic activity amidst this global pandemic due to the Coronavirus Disease (COVID-19).

23 March 2020: Monetary Board approves additional PHP 300 billion support to the National Government to fight COVID-19

The Monetary Board authorized the Bangko Sentral ng Pilipinas (BSP) to purchase government securities from the Bureau of Treasury (BTr) under a repurchase agreement in the amount of Php 300 billion.
The fund generated from the said agreement shall be used to support the National Government’s (NG) programs to counter the impact of Coronavirus Disease 2019 (COVID-19).

20 March 2020: Bangko Sentral ng Pilipinas reduction in policy rates

The Monetary Board (MB), in its meeting dated 19 March 2020, decided to reduce the policy rate by 50 basis points and approved the temporary reduction in the term spread on Peso rediscounting loans relative to BSP’s overnight lending rate to zero. As such, the applicable rediscount rate for loans under the Peso Rediscount Facility has been set at 3.75 percent, regardless of loan maturity (i.e., 1- 180 days).

The said Peso rediscount rate shall be effective for a period of 60 days from 20 March 2020 or until 19 May 2020, subject to further extension as may be approved by the MB.

            Taiwan

28 January 2021: CBC releases meeting minutes of Monetary Policy Meeting

The Central Bank of the Republic of China (Taiwan) announced the release of the minutes of the Monetary Policy Meeting held on December 17, 2020.

Press Release
Meeting Minutes

17 December 2020: CBC publishes Board meeting monetary policy decision

The Central Bank of the Republic of China (Taiwan) published its monetary policy decision following the latest Board meeting. The Board decided unanimously to keep the discount rate, the rate on refinancing of secured loans, and the rate on temporary accommodations unchanged at 1.125%, 1.50%, and 3.375%, respectively.

Full press release

29 October 2020: CBC releases meeting minutes of Monetary Policy Meeting

The Central Bank of the Republic of China (Taiwan) announced the release of the minutes of the Monetary Policy Meeting held on September 17, 2020.

Press Release
Meeting Minutes

17 September 2020: CBC publishes Board meeting monetary policy decision

The Central Bank of the Republic of China (Taiwan) published its monetary policy decision following the latest Board meeting. The Board decided unanimously to keep the discount rate, the rate on refinancing of secured loans, and the rate on temporary accommodations unchanged at 1.125%, 1.50%, and 3.375%, respectively.

Full press release

30 July 2020: CBC releases meeting minutes of Monetary Policy Meeting

The Central Bank of the Republic of China (Taiwan) announced the release of the minutes of the Monetary Policy Meeting held on June 18, 2020.

Press Release
Meeting Minutes

18 June 2020: Monetary Policy Decision of the Board Meeting

The Central Bank of the Republic of China (Taiwan) released it statement on monetary policy decisions in the context of the ongoing coronavirus (COVID-19) pandemic and impact on the domestic economy and financial conditions. The discount rate, the rate on refinancing of secured loans, and the rate on temporary accommodations are kept unchanged at 1.125%, 1.50%, and 3.375%, respectively.

Full press release

26 March 2020: Taiwan central bank adjusts the interest rate for Reserves Account B of financial institutions (in Chinese)

In order to reflect the reduction of bank deposit interest rate, effective from 27 March, the interest rates on deposits of financial institutions in the Reserve Account B (55% of the reserve required) at the central bank is reduced to 0.068% for the current deposit portion and 0.560% for the fixed deposit portion.

19 March 2020: Taiwan central bank lowers benchmark rate and sets in place accommodation facility for SMEs

The discount rate, the rate on accommodations with collateral, and the rate on accommodations without collateral will, effective 20 March 2020, be reduced by 0.25 percentage points to 1.125%, 1.50%, and 3.375%, respectively.

Under the special accommodation facility, the Bank will, preliminarily, provide banks with additional funds of a total amount of NT$200 billion and at a rate of one percentage point lower than the policy rate on accommodations with collateral, in order to support credit extensions to SMEs.

            Malaysia

20 January 2021: Bank Negara Malaysia publishes monetary policy statement

At its meeting, the Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to maintain the Overnight Policy Rate (OPR) at 1.75 percent.

The MPC considers the stance of monetary policy to be appropriate and accommodative. Given the uncertainties surrounding the pandemic, the stance of monetary policy going forward will be determined by new data and information, and their implications on the overall outlook for inflation and domestic growth. The Bank remains committed to utilise its policy levers as appropriate to create enabling conditions for a sustainable economic recovery.

3 November 2020: Bank Negara Malaysia publishes monetary policy statement

At its meeting today, the Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to maintain the Overnight Policy Rate (OPR) at 1.75 percent. The MPC considers the stance of monetary policy to be appropriate and accommodative. The cumulative 125 basis points reduction in the OPR this year will continue to provide stimulus to the economy.

10 September 2020: Bank Negara Malaysia publishes monetary policy statement

At its meeting, the Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to maintain the Overnight Policy Rate (OPR) at 1.75 percent. The cumulative 125 basis points reduction in the OPR this year will continue to provide stimulus to the economy. Given the outlook for growth and inflation, the MPC considers the stance of monetary policy to be appropriate and accommodative. The Bank remains committed to utilise its policy levers as appropriate to create enabling conditions for a sustainable economic recovery.

7 July 2020: Bank Negara Malaysia publishes monetary policy statement

The Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to reduce the Overnight Policy Rate (OPR) by 25 basis points to 1.75 percent. The ceiling and floor rates of the corridor of the OPR are correspondingly reduced to 2.00 percent and 1.50 percent, respectively. The MPC will continue to assess evolving conditions and their implications on the overall outlook for inflation and domestic growth. The Bank will continue to utilise its policy levers as appropriate to create enabling conditions for a sustainable economic recovery.

5 May 2020: Bank Negara Malaysia publishes monetary policy statement

The Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to reduce the Overnight Policy Rate (OPR) by 50 basis points to 2.00 percent. The ceiling and floor rates of the corridor of the OPR are correspondingly reduced to 2.25 percent and 1.75 percent, respectively. With this decision, the OPR has been reduced by a total of 100 basis points, complementing other monetary and financial measures by Bank Negara Malaysia as well as fiscal measures this year.

27 March 2020: Additional Measures to Further Support SMEs and Individuals Affected by the COVID-19 Outbreak

In its efforts to cushion the impact of disruptions caused by COVID-19 outbreak, Bank Negara Malaysia (BNM) announces additional measures including a reduction of interest rate (IRCC) and profit rate (PRCC) stress factor caps applied under the Risk-Based Capital Framework for Insurers and Risk-Based Capital Framework for Takaful Operators (Frameworks), respectively.

25 March 2020: Measures to Assist Individuals, SMEs and Corporates Affected by COVID-19

Bank Negara Malaysia announces a number of regulatory and supervisory measures in support of efforts by banking institutions to assist individuals, small and medium-sized enterprises (SMEs) and corporations to manage the impact of the Covid-19 outbreak, including open market operation outright purchase of government securities, FX swaps, reverse repos and the standing facility.

            Republic of Korea

25 February 2021: Bank of Korea publishes Monetary Policy Decision

The Monetary Policy Board of the Bank of Korea decided to leave the Base Rate unchanged at 0.50% for the intermeeting period. Currently available information suggests that the recovery of the global economy has remained slow due to the ongoing influence of the movement restrictions following the resurgence of COVID-19

25 December 2020: Bank of Korea publishes Monetary Policy Statement for 2021

The Bank of Korea published its report on monetary policy for 2021, including an overview of the current monetary environment in light of COVID-19. The Bank of Korea will maintain its accommodative monetary policy stance, while paying close attention to financial imbalance risks under the prolonged monetary easing stance. It will decide whether to extend credit market support measures depending on market conditions, while continuing its support for growth through the Bank Intermediated Lending Support Facility.

The Bank will determine whether to continue its credit market support measures, by closely monitoring their effect and the extent of recovery of the financial intermediary function. On 24 December, the Government extended (FSC press release) the purchase program of the SPV set up to buy corporate bonds and commercial paper by six months (from January 13, 2021 to July 13, 2021). The Bank will also determine whether or not to extend its Corporate Bond-Backed Lending Facility (scheduled to expire in February 2021), in consideration of funding conditions for financial institutions and corporate bond market.

27 August 2020: Bank of Korea publishes Monetary Policy Decision

The Monetary Policy Board of the Bank of Korea decided to leave the Base Rate unchanged at 0.50% for the intermeeting period. As economic growth is expected to be sluggish and inflationary pressures on the demand side are forecast to remain weak due to the COVID19 pandemic, the Board will maintain its accommodative monetary policy stance.

17 July 2020: SPV to start purchasing corporate bonds and CP

The government announced the official launching of the special purpose vehicle intended to support businesses facing liquidity problems by purchasing corporate bonds and CP on July 17. The SPV s bond purchasing program will be up to KRW10 trillion, made up of KRW 1 trillion (10%) in equity capital from KDB, KRW1 trillion (10%) in subordinated loans from KDB and KRW 8 trillion (80%) in primary loans from BOK with the possibility of expanding the size up to KRW20 trillion.
The bond purchasing program will be operated on a temporary basis for six months from July 14, 2020 until January 13, 2021, with the possibility of extension afterwards.

Full press release

16 July 2020: Bank of Korea publishes Monetary Policy Decision

The Monetary Policy Board of the Bank of Korea decided to leave the Base Rate unchanged at 0.50% for the intermeeting period. The Board will continue to conduct monetary policy in order to support the economy and stabilize consumer price inflation at the target level over a medium-term horizon, while paying attention to financial stability.

20 May 2020: Government unveils plans to create SPV to support corporate bond and CP markets

The government announced specific plans to create a special purpose vehicle (SPV) aimed at supporting the corporate bond and commercial paper markets. The government, the Bank of Korea and the Korea Development Bank will set up a KRW10 trillion SPV to help stabilize the corporate bond market, with the possibility of increasing its size up to KRW20 trillion.

Full press release

10 April 2020: Bank of Korea Broadens Securities Eligible for Open Market Operations

The Bank of Korea decided to broaden the range of securities eligible for open market operation transactions to expand liquidity supply channels. The new range of securities eligible for open market operations will be valid from April 14, 2020 to March 31, 2021.

Full press release

24 March 2020: Financial Services Commission outlines measures to stabilize financial markets

Key measures include financing support for businesses; establishment of a bond market stabilization fund; financing for corporate bond issuance; liquidity measures for the repo and commercial paper markets; and a stock market stabilization fund.

            Singapore

3 September 2020: MAS enhances access to liquidity facilities to strengthen banking sector resilience

The Monetary Authority of Singapore (MAS) announced measures to enhance the banking system’s access to Singapore dollar (SGD) and US dollar (USD) funding. The new measures will strengthen banking sector resilience, promote more stable SGD and USD funding conditions, and support credit intermediation amid continued economic headwinds from the COVID-19 pandemic.

30 March 2020: MAS Monetary Policy Statement - April 2020

MAS will adopt a zero percent per annum rate of appreciation of the policy band starting at the prevailing level of the S$NEER. There will be no change to the width of the policy band. This policy decision hence affirms the present level of the S$NEER, as well as the width and zero percent appreciation slope of the policy band going forward, thus providing stability to the trade-weighted exchange rate.

            Middle East

16 November 2020: CBUAE extends the applicability period of the Targeted Economic Support Scheme (TESS)

The Central Bank of the UAE (CBUAE) has announced the extension of the applicability period of the key components of its economic stimulus package, the Targeted Economic Support Scheme (TESS)until 30 June 2021. The TESS was launched by the CBUAE in March 2020 to support the UAE’s economy during the COVID-19 pandemic, through a range of integrated relief measures to the banking sector related to funding, liquidity, lending and capital.

Full press release

27 October 2020: CBK Maintains Current Historical Low Discount Rate, and Cuts Other Intervention Rates by 0.125%

As part of Central Bank of Kuwait (CBK) vigilant monitoring of economic, monetary, and banking developments and forecast trends, as well as its periodic review of movements in interest rate trends on main currencies, the US Dollar being foremost, the CBK decided to maintain the current Discount Rate, thus maintaining the current interest rate cap for loans extended to customers in Kuwaiti Dinar.

In addition, CBK cut rates of other monetary policy instruments, by 0.125% for the entire interest rate yield curve terms matrix, up to the ten-year term. This includes repurchases (REPO), CBK Bonds, the Term-Deposits system, direct intervention instruments, as well as Public Debt instruments, effective 28-10-2020.

10 August 2020: QCB releases statement on the issuance of Treasury bills for Aug 2020

As part of the Qatar Central Bank’s monetary policy initiatives and its efforts to strengthen the financial system as well as to activate the tools available for the open market operations; Qatar Central Bank (QCB) issued on Monday, Aug 10, 2020 treasury bills for three, six and nine months, with a value of QR 600 million, distributed as follows:

300 million QR for three months at an interest rate of 0.20%
200 million QR for six months at an interest rate of 0.29%
100 million QR for nine months at an interest rate of 0.35%

See also:
Statement on the issuance of Treasury bills for Jul 2020
Statement on the issuance of Treasury bills for Jun 2020

8 August 2020: CBUAE publishes additional measures within the Targeted Economic Support Scheme

The Board of the Central Bank of the UAE (CBUAE) decided on additional measures within the Targeted Economic Support Scheme (TESS) launched initially in March 2020 to further enhance the capacity of the banking sector to support the economy. The measures include a review of the existing thresholds of two prudential ratios: the Net Stable Funding Ratio (NSFR) and the Advances to Stable Resources Ratio (ASRR) by temporarily relaxing the requirements for the structural liquidity position of banks.

20 May 2020: QCB publishes Circulars on combating the risk of coronavirus (COVID-19) pandemic outbreak

The Qatar Central Bank issued a package of instructions to financial institutions operating in the State of Qatar for purpose of combating the risk of coronavirus (COVID-19) pandemic outbreak.

16 May 2020: CBUAE publishes Bank’s names that availed more than 50% of the allocated TESS liquidity facility

The Central Bank of the UAE (CBUAE) published a note endorsing banks’ progressive steps to support customers affected by the COVID-19 pandemic. To date, 77% is already drawn-down from the AED 50 billion liquidity facility within the Targeted Economic Support Scheme (TESS), equivalent to AED 38.5 billion of allocated funds.

To incentivise banks and finance companies to draw-down more from the TESS liquidity zero cost funding facility designated to be used by impacted private corporate customers, SMEs and individuals, the CBUAE has also issued a notice that includes additional clarifications on the deferral requests under the TESS and aims to further facilitate the implementation of the scheme.

7 May 2020: CBUAE endorses banks’ firm steps to support their customers affected by the COVID-19 pandemic

The Central Bank of the UAE (CBUAE) endorses banks’ firm steps to support their customers affected by the COVID-19 pandemic. To date, 75% was already draw-down from the AED 50 billion liquidity facility, equivalent to AED 37.2 billion total consumption of allocated funds

24 April 2020: Central Bank of the UAE confirms progressive commitment to TESS programme

The Central Bank of the UAE (CBUAE) confirms the progress in the implementation of Targeted Economic Support Scheme (TESS) by banks and finance companies for the benefit of individuals, small and medium-sized enterprises (SMEs) and other private corporates affected by COVID-19 pandemic.

The CBUAE welcomes banks’ active utilisation of allocated funds, which have doubled in a one-week period reaching over 60% of the TESS AED 50 billion liquidity facility which is equivalent to AED 30 billion total consumption of allocated fund.

16 March 2020: CBK Cuts its Discount Rate by 1% from 2.50% to 1.50%

The Central Bank of Kuwait’s Board of Directors has decided on 16 March 2020 to cut the discount rate 1% (from 2.5% to 1.5%) effective from 17 March 2020. This decision is part of the preventative measures the CBK has taken to contain the negative impact of the COVID-19 outbreak on the global and national economic growth, in addition to the steep decline in oil prices and its impact on Kuwait’s fiscal position, and the 15 March 2020 Federal Reserve decision to cut interest rates by 1%.

This historical low interest rate aims to reduce the cost of borrowing across economic sectors for both individuals and corporations, to foster an atmosphere conducive to sustainable economic growth, and to maintain monetary and financial stability.

16 March 2020: QCB lowers policy rates in line with US Federal Reserve

The Qatar Central Bank (QCB) has lowered its policy rates twice in March in line with the US Federal Reserve (to maintain the currency peg). The deposit rate has been reduced by 100bps to 1 percent; the lending rate has been reduced by 175 bps to 2.5 percent; and repo rate has been reduced by 100 bps to 1.5 percent. The QCB will also provide additional liquidity to banks operating in the country.

16 March 2020: SAMA lowers policy rates 16 March 2020, following previous 3 March 2020 rate cuts.

The Saudi Arabian Monetary Authority (SAMA) has reduced its policy rates twice in March, lowering its reverse repo and repo rates by a combined 1.25 pp to 0.5 and 1 percent respectively. On 14 March, SAMA announced a SAR 50 billion ($13.3 billion, 1.9 percent of GDP) package to support the private sector, particularly SMEs, by providing funding to banks to allow them to defer payments on existing loans and increase lending to businesses. The central bank will also cover fees for private sector stores and entities for point-of-sale and e-commerce transactions for 3 months. The Governor has announced that the central bank stands ready to supply liquidity if needed.

14 March 2020: Central Bank of the UAE announces Targeted Economic Support Scheme

The CBUAE has announced a comprehensive AED 100 billion Targeted Economic Support Scheme (TESS) to contain the repercussions of the pandemic COVID-19 and subsequently published its Standards for the CBUAE's TESS.

The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00 per cent, 0.25 per cent and -0.50 per cent respectively.
The Governing Council decided to increase the envelope of the pandemic emergency purchase programme (PEPP) by €500 billion to a total of €1,850 billion. It also extended the horizon for net purchases under the PEPP to at least the end of March 2022. The Governing Council also decided to extend the reinvestment of principal payments from maturing securities purchased under the PEPP until at least the end of 2023.
The Governing Council decided to further recalibrate the conditions of the third series of targeted longer-term refinancing operations (TLTRO III). Specifically, it decided to extend the period over which considerably more favourable terms will apply by twelve months, to June 2022. Three additional operations will also be conducted between June and December 2021. Moreover, the Governing Council decided to raise the total amount that counterparties will be entitled to borrow in TLTRO III operations from 50 per cent to 55 per cent of their stock of eligible loans.
The Governing Council decided to extend to June 2022 the duration of the set of collateral easing measures adopted by the Governing Council on 7 and 22 April 2020. The extension of these measures will continue to ensure that banks can make full use of the Eurosystem’s liquidity operations, most notably the recalibrated TLTROs. The Governing Council will reassess the collateral easing measures before June 2022, ensuring that Eurosystem counterparties’ participation in TLTRO III operations is not adversely affected.
The Governing Council also decided to offer four additional pandemic emergency longer-term refinancing operations (PELTROs) in 2021, which will continue to provide an effective liquidity backstop.
Net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion. The Governing Council continues to expect monthly net asset purchases under the APP to run for as long as necessary to reinforce the accommodative impact of its policy rates, and to end shortly before it starts raising the key ECB interest rates.
The Eurosystem repo facility for central banks (EUREP) and all temporary swap and repo lines with non-euro area central banks will be extended until March 2022.
Finally, the Governing Council decided to continue conducting its regular lending operations as fixed rate tender procedures with full allotment at the prevailing conditions for as long as necessary.

The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively.
The Governing Council will continue its purchases under the pandemic emergency purchase programme (PEPP) with a total envelope of €1,350 billion. These purchases contribute to easing the overall monetary policy stance, thereby helping to offset the downward impact of the pandemic on the projected path of inflation. The purchases will continue to be conducted in a flexible manner over time, across asset classes and among jurisdictions.
Net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion, together with the purchases under the additional €120 billion temporary envelope until the end of the year.
The Governing Council will also continue to provide ample liquidity through its refinancing operations. In particular, the latest operation in the third series of targeted longer-term refinancing operations (TLTRO III) has registered a very high take-up of funds, supporting bank lending to firms and households.

The Governing Council continues to stand ready to adjust all of its instruments, as appropriate, to ensure that inflation moves towards its aim in a sustained manner, in line with its commitment to symmetry.

Full press release

20 August 2020: ECB releases account of monetary policy meeting of the Governing Council, 15-16 July 2020

The account of the monetary policy meeting of the Governing Council of the European Central Bank 15-16 July 2020 was published, including the review of financial, economic and monetary developments and policy options, and the Governing Council’s monetary policy decisions.

Full press release

30 July 2020: ECB Economic Bulletin Issue 5/2020: The impact of the ECB’s monetary policy measures taken in response to the COVID-19 crisis

The ECB’s latest Economic Bulletin Issue 5/2020 included a section on the impact of the ECB’s monetary policy measures taken in response to the COVID-19 crisis. The publication covers the ECB’s response to the crisis, liquidity conditions, credit flows, and price stability among other items.

ECB Economic Bulletin, Issue 5/2020

16 July 2020: ECB releases Monetary policy decisions

The Governing Council of the ECB has taken the following monetary policy decisions:

The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively.
The Governing Council will continue its purchases under the pandemic emergency purchase programme (PEPP) with a total envelope of €1,350 billion.
Net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion, together with the purchases under the additional €120 billion temporary envelope until the end of the year.
The Governing Council will also continue to provide ample liquidity through its refinancing operations. In particular, the latest operation in the third series of targeted longer-term refinancing operations (TLTRO III) has registered a very high take-up of funds, supporting bank lending to firms and households.

The Governing Council continues to stand ready to adjust all of its instruments, as appropriate, to ensure that inflation moves towards its aim in a sustained manner, in line with its commitment to symmetry.

Full press release

25 June 2020: ECB sets up new Eurosystem repo facility to provide euro liquidity to non-euro area central banks

In response to the coronavirus (COVID-19) crisis, the Governing Council of the European Central Bank (ECB) decided to set up a new backstop facility, called the Eurosystem repo facility for central banks (EUREP), to provide precautionary euro repo lines to central banks outside the euro area. EUREP addresses possible euro liquidity needs in case of market dysfunction resulting from the COVID-19 shock that might adversely impact the smooth transmission of ECB monetary policy.

Under EUREP, the Eurosystem will provide euro liquidity to a broad set of central banks outside the euro area against adequate collateral, consisting of euro-denominated marketable debt securities issued by euro area central governments and supranational institutions.

EUREP complements the ECB’s bilateral swap and repo lines and reflects the importance of the euro in global financial markets. EUREP will be available until the end of June 2021.

Full press release
Eurosystem repo facility for central banks (EUREP) - FAQ

4 June 2020: ECB releases Monetary policy decisions

The Governing Council of the ECB has taken the following monetary policy decisions:

The envelope for the pandemic emergency purchase programme (PEPP) will be increased by €600 billion to a total of €1,350 billion.
The horizon for net purchases under the PEPP will be extended to at least the end of June 2021.
The maturing principal payments from securities purchased under the PEPP will be reinvested until at least the end of 2022.
Net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion, together with the purchases under the additional €120 billion temporary envelope until the end of the year.
Reinvestments of the principal payments from maturing securities purchased under the APP will continue, in full, for an extended period of time past the date when the Governing Council starts raising the key ECB interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation.
The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively.

The Governing Council continues to stand ready to adjust all of its instruments, as appropriate, to ensure that inflation moves towards its aim in a sustained manner, in line with its commitment to symmetry.

Full press release

ECB Governing Council Press Conference - 04 June 2020

11 May 2020: Official Journal of the European Union publishes Guideline (EU) 2020/634 of the European Central Bank of 7 May 2020

The Official Journal of the European Union published Guideline (EU) 2020/634 of the European Central Bank of 7 May 2020, amending Guideline ECB/2014/31 on additional temporary measures relating to Eurosystem refinancing operations and eligibility of collateral (ECB/2020/29). This follows the ECB’s announcement on 7 May 2020 of temporary collateral easing measures

Guideline (EU) 2020/634

5 May 2020: ECB takes note of German Federal Constitutional Court ruling and remains fully committed to its mandate

The Governing Council received a preliminary briefing by the governor of the Bundesbank and by the legal department of the European Central Bank (ECB). The ECB takes note of the judgment by the German Federal Constitutional Court regarding the Public Sector Purchase Programme (PSPP).

The Governing Council remains fully committed to doing everything necessary within its mandate to ensure that inflation rises to levels consistent with its medium-term aim and that the monetary policy action taken in pursuit of the objective of maintaining price stability is transmitted to all parts of the economy and to all jurisdictions of the euro area.

Full press release

4 May 2020: ECB publishes summary of decisions taken by the Governing Council

The ECB published an overview on decisions taken by the Governing Council in the areas of monetary policy, market operations, market infrastructure and payments, advice on legislation, corporate governance and banking supervision among other subjects.

30 April 2020: ECB publishes the Governing Council monetary policy decision

The Governing Council of the ECB took the following monetary policy decisions:

The conditions on the targeted longer-term refinancing operations (TLTRO III) have been further eased.
A new series of non-targeted pandemic emergency longer-term refinancing operations (PELTROs) will be conducted to support liquidity conditions in the euro area financial system and contribute to preserving the smooth functioning of money markets by providing an effective liquidity backstop.
The PEPP will continue to be conducted in a flexible manner over time, across asset classes and among jurisdictions. The Governing Council will conduct net asset purchases under the PEPP until it judges that the coronavirus crisis phase is over, but in any case until the end of this year.
Moreover, net purchases under the asset purchase programme (APP) will continue at a monthly pace of €20 billion, together with the purchases under the additional €120 billion temporary envelope until the end of the year.
Reinvestments of the principal payments from maturing securities purchased under the APP will continue, in full, for an extended period of time past the date when the Governing Council starts raising the key ECB interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation.
The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively.

Interest rate on all targeted longer-term refinancing operations (TLTRO III) reduced by 25 basis points to -0.5% from June 2020 to June 2021
For banks meeting the lending threshold of 0% introduced on 12 March 2020, the interest rate can be as low as -1%
Start of the lending assessment period brought forward to 1 March 2020

If a marketable debt instrument has an initial maturity of 365/366 days or less, the minimum remaining maturity shall be 28 days at the time of its purchase by the relevant Eurosystem central bank.
If a marketable debt instrument has an initial maturity of 367 days or more, the minimum remaining maturity shall be 6 months and the maximum remaining maturity shall be 30 years and 364 days at the time of its purchase by the relevant Eurosystem central bank.

A temporary increase in the APP until the end of the year, adding additional net purchases of €120bn. The ECB emphasised a strong contribution from the private sector purchases programmes, suggesting a relative step-up in CSPP purchases.
Additional longer-term refinancing operations (LTROs).  These will be carried out through a fixed rate tender procedure with full allotment, with an interest rate that is equal to the average rate on the deposit facility.
More favourable terms applied to all outstanding targeted longer-term refinancing operations (TLTROs) for the period of June 2020 to June 2021, intended to provide additional support through bank-lending to SMEs.

The Board of Governors of the Federal Reserve System voted unanimously to maintain the interest rate paid on required and excess reserve balances at 0.10 percent, effective January 28, 2021.
As part of its policy decision, the Federal Open Market Committee voted to authorize and direct the Open Market Desk at the Federal Reserve Bank of New York, until instructed otherwise, to execute transactions in the System Open Market Account in accordance with the domestic policy directive (see directive in Implementation Note).
In a related action, the Board of Governors of the Federal Reserve System voted unanimously to approve the establishment of the primary credit rate at the existing level of 0.25 percent.

The Board of Governors of the Federal Reserve System voted unanimously to maintain the interest rate paid on required and excess reserve balances at 0.10 percent, effective December 17, 2020.
As part of its policy decision, the Federal Open Market Committee voted to authorize and direct the Open Market Desk at the Federal Reserve Bank of New York, until instructed otherwise, to execute transactions in the System Open Market Account in accordance with the domestic policy directive (see directive in Implementation Note).
In a related action, the Board of Governors of the Federal Reserve System voted unanimously to approve the establishment of the primary credit rate at the existing level of 0.25 percent.

The Board of Governors of the Federal Reserve System voted unanimously to maintain the interest rate paid on required and excess reserve balances at 0.10 percent, effective November 6, 2020.
As part of its policy decision, the Federal Open Market Committee voted to authorise and direct the Open Market Desk at the Federal Reserve Bank of New York, until instructed otherwise, to execute transactions in the System Open Market Account in accordance with the domestic policy directive (see directive in Implementation Note).
In a related action, the Board of Governors of the Federal Reserve System voted unanimously to approve the establishment of the primary credit rate at the existing level of 0.25 percent.

The Board of Governors of the Federal Reserve System voted unanimously to maintain the interest rate paid on required and excess reserve balances at 0.10 percent, effective July 30, 2020.

As part of its policy decision, the Federal Open Market Committee voted to authorize and direct the Open Market Desk at the Federal Reserve Bank of New York, until instructed otherwise, to execute transactions in the System Open Market Account

In a related action, the Board of Governors of the Federal Reserve System voted unanimously to approve the establishment of the primary credit rate at the existing level of 0.25 percent.

Establishment of two facilities to support credit to large employers – the Primary Market Corporate Credit Facility (PMCCF) for new bond and loan issuance and the Secondary Market Corporate Credit Facility (SMCCF) to provide liquidity for outstanding corporate bonds.
Establishment of a third facility, the Term Asset-Backed Securities Loan Facility (TALF), to support the flow of credit to consumers and businesses. The TALF will enable the issuance of asset-backed securities (ABS) backed by student loans, auto loans, credit card loans, loans guaranteed by the Small Business Administration (SBA), and certain other assets.
Facilitating the flow of credit to municipalities by expanding the Money Market Mutual Fund Liquidity Facility (MMLF) to include a wider range of securities, including municipal variable rate demand notes (VRDNs) and bank certificates of deposit.
Facilitating the flow of credit to municipalities by expanding the Commercial Paper Funding Facility (CPFF) to include high-quality, tax-exempt commercial paper as eligible securities. In addition, the pricing of the facility has been reduced.

18 March 2020: Fed announces establishment of a Money Market Mutual Fund Liquidity Facility (MMLF)

The Federal Reserve Board broadened its program of support for the flow of credit to households and businesses by taking steps to enhance the liquidity and functioning of crucial money markets. Through the establishment of a Money Market Mutual Fund Liquidity Facility, or MMLF, the Federal Reserve Bank of Boston will make loans available to eligible financial institutions secured by high-quality assets purchased by the financial institution from money market mutual funds.

17 March 2020: Fed announces establishment of a Primary Dealer Credit Facility (PDCF)

The Federal Reserve Board announced that it will establish a Primary Dealer Credit Facility, or PDCF, to support the credit needs of American households and businesses. The facility will allow primary dealers to support smooth market functioning and facilitate the availability of credit to businesses and households.

The PDCF will offer overnight and term funding with maturities up to 90 days and will be available on 20 March 2020. It will be in place for at least six months and may be extended as conditions warrant. Credit extended to primary dealers under this facility may be collateralized by a broad range of investment grade debt securities, including commercial paper and municipal bonds, and a broad range of equity securities. The interest rate charged will be the primary credit rate, or discount rate, at the Federal Reserve Bank of New York. More detailed terms and conditions and an operational calendar will be subsequently released.

17 March 2020: Fed announces establishment of a Commercial Paper Funding Facility (CPFF)

The Federal Reserve Board announced that it will establish a Commercial Paper Funding Facility (CPFF) to support the flow of credit to households and businesses. The CPFF will provide a liquidity backstop to U.S. issuers of commercial paper through a special purpose vehicle (SPV) that will purchase unsecured and asset-backed commercial paper rated A1/P1 (as of March 17, 2020) directly from eligible companies.

Please note that on 6 April 2020, the Federal Reserve published an extended revision of its FAQs page about the Commercial Paper Funding Facility.

15 March 2020: Fed announces actions to support the flow of credit to households and businesses

As well as cutting the primary credit rate for its discount window 150 basis points to 0.25% and a 100 basis point reduction in its target rate for federal funds to a range of 0% to 0.25%, the Fed encouraged more active use of the discount window, allowing depository institutions to borrow for periods up to 90 days, payable or renewable on a daily basis.

Furthermore, the Fed is encouraging depository institutions to utilize intraday credit extended by Reserve Banks, is encouraging banks to use their capital and liquidity buffers as they lend to households and businesses who are affected by the coronavirus, and has reduced reserve requirement ratios to zero percent effective on March 26, the beginning of the next reserve maintenance period.

15 March 2020: FOMC announces $500bn purchases of Treasuries and $200bn of MBS

Effective 16 March 2020, the Federal Open Market Committee (FOMC) directed the Open Market Trading Desk (the Desk) to increase over coming months the System Open Market Account (SOMA) holdings of Treasury securities and agency mortgage-backed securities (MBS) by at least $500 billion and at least $200 billion, respectively.  The FOMC instructed the Desk to conduct these purchases at a pace appropriate to support the smooth functioning of markets for Treasury securities and agency MBS. The FOMC also directed the Desk to continue rolling over at auction all principal payments from Treasury securities holdings and to reinvest all principal payments from agency debt and agency MBS holdings in agency MBS.

12 March 2020: NY Fed launches $500bn one-month and three-month repo operations

The Federal Reserve Bank of New York announced that its Open Market Trading Desk (the Desk) will offer $500 billion in a three-month repo operation settling on March 13, 2020. On March 13, the Desk will further offer $500 billion in a three-month repo operation and $500 billion in a one-month repo operation for same day settlement. Three-month and one-month repo operations for $500 billion will be offered on a weekly basis for the remainder of the monthly schedule. The Desk will continue to offer at least $175 billion in daily overnight repo operations and at least $45 billion in two-week term repo operations twice per week over this period.

            UK:

4 February 2021: Bank of England releases Monetary Policy Summary and minutes of the Monetary Policy Committee meeting

At its meeting ending on 3 February 2021, the Committee judged that the existing stance of monetary policy remains appropriate. The MPC voted unanimously to maintain Bank Rate at 0.1%.The Committee voted unanimously for the Bank of England to maintain the stock of sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, at £20 billion. The Committee voted unanimously for the Bank of England to continue with its existing programme of UK government bond purchases, financed by the issuance of central bank reserves, maintaining the target for the stock of these government bond purchases at £875 billion and so the total target stock of asset purchases at £895 billion.

Full press release
Monetary Policy Summary and minutes of MPC 3 February 2021

4 February 2021: Bank of England publishes market notice on Asset Purchase Facility: Gilt Purchases

On 3 February 2021 the MPC voted to maintain the target stock of purchased UK government bonds, financed by the issuance of central bank reserves, at £875 billion.

The market notice sets out details of the Bank’s planned APF gilt purchases taking place from the week commencing 8 February 2021 up to and including the week commencing 15 March 2021 – which is the week of the MPC’s March meeting. It covers the ongoing £150bn gilt purchases announced in November 2020 and the reinvestment of proceeds of a gilt maturity occurring on 22 January 2021 as set out in the December 2020 market notice.

The Bank intends to purchase evenly across the three gilt maturity sectors. For operations scheduled between 8 February 2021 and 17 March 2021 the planned size of auctions will be £1.48bn for each maturity sector. The range of gilts eligible for purchase will remain unchanged from previous operations.

28 January 2021: Bank of England publishes update on the Covid Corporate Financing Facility (CCFF) – Market Notice 9 October 2020

The Market Notice provides an update on how CCFF issuers’ credit quality will be monitored and reviewed in advance of the closure of the CCFF. It supplements, and should be read in conjunction with, the consolidated Market Notice dated 9 October 2020 and the Market Notice confirming the closure of the CCFF dated 22 September 2020. This Market Notice was originally published on 9 October 2020 and was updated on 28 January 2021 to provide further clarity of existing policy.

25 January 2021: Bank of England publishes Asset Purchase Facility Quarterly Report - 2020 Q4

The report contains information on the Bank of England’s Asset Purchase Facility (APF) for 2020 Q4, describing operations from 1 October 2020 to 31 December 2020. More information on what the APF is and what it does is available in our Market Operations Guide. A short timeline describing the history of the APF is provided as background at the end of the report.

During 2020 Q4 the APF made £48.6 billion of gilt purchases. Details of the purchase programme for the period can be found in the Market Notice published on 6 August 2020. The APF also made £0.1 billion of corporate bond purchases in 2020 Q4.

21 January 2021: Bank of England publishes minutes of Money Markets Committee meeting

The Bank of England published minutes of the Money Markets Committee meeting from 3 December 2020.

Full press release
Minutes

5 November 2020: Bank of England maintains Bank Rate at 0.1% - November 2020

At its meeting ending on 4 November 2020, the MPC voted unanimously to maintain Bank Rate at 0.1%. The Committee voted unanimously for the Bank of England to maintain the stock of sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, at £20 billion. The Committee voted unanimously for the Bank of England to continue with the existing programme of £100 billion of UK government bond purchases, financed by the issuance of central bank reserves, and also for the Bank of England to increase the target stock of purchased UK government bonds by an additional £150 billion, financed by the issuance of central bank reserves, to take the total stock of government bond purchases to £875 billion.

Full press release
Monetary Policy Summary and minutes

5 November 2020: Bank of England publishes Monetary Policy Report - November 2020

The Bank of England published its quarterly Monetary Policy Report, assessing the impact of Covid-19 on the economy in addition to the MPC’s latest projections on the UK financial system.

Full press release
Monetary Policy Report

26 October 2020: Bank of England publishes Asset Purchase Facility Quarterly Report - 2020 Q3

The report contains information on the Bank of England’s Asset Purchase Facility (APF) for Q3, from 1 July 2020 to 30 September 2020, describing the operations carried out during this period. More information on what the APF is and what it does is available in the Bank’s Market Operations Guide. A short timeline describing the history of the APF is provided as background at the end of the report.

During 2020 Q3 the APF made £73.3 billion of gilt purchases. Details of the purchase programme for this period can be found in the Market Notice published on 18 June 2020 and the Market Notice published on 13 August 2020. The APF also made £3.3 billion of corporate bond purchases in 2020 Q3. Further details can be found within the Market Notices published on 2 April 2020 and 1 May 2020.

9 October 2020: Bank of England publishes market notice on the Covid Corporate Financing Facility (CCFF)

The Market Notice provides an update on how CCFF issuers’ credit quality will be monitored and reviewed in advance of the closure of the CCFF. It supplements, and should be read in conjunction with, the consolidated Market Notice dated 3 August 2020 and the Market Notice confirming the closure of the CCFF dated 22 September 2020.

6 October 2020: Bank of England publishes minutes of Money Markets Committee meeting

The Bank of England published minutes of the Money Markets Committee meeting from 7 September 2020. The committee discussed market conditions and post-Covid changes in sterling money markets, among other items.

Full press release
Minutes

22 September 2020: Bank of England publishes market notice on the Covid Corporate Financing Facility (CCFF)

As indicated in the initial Market Notice of 18 March 2020 the CCFF was intended to operate for an initial period of 12 months. In line with this, and in light of current market conditions and recent usage patterns, the Bank and HM Treasury gave 6 months’ notice of the withdrawal of the facility. The CCFF will close for new purchases of CP from eligible issuers with effect from 23 March 2021. This means that the Facility will make no purchases of CP after 22 March 2021. The CCFF will also close to new applications from counterparties and issuers looking to become eligible on 31 December 2020.

17 September 2020: Bank of England publishes Monetary Policy Summary and minutes of Monetary Policy Committee meeting

At its meeting ending on 16 September 2020, the MPC voted unanimously to maintain Bank Rate at 0.1%. The Committee voted unanimously for the Bank of England to continue with its existing programmes of UK government bond and sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, maintaining the target for the total stock of these purchases at £745 billion.

Full press release
Monetary Policy Summary and minutes

6 August 2020: Bank of England maintains Bank Rate at 0.1% - August 2020

At its meeting ending on 4 August 2020, the MPC voted unanimously to maintain Bank Rate at 0.1%. The Committee voted unanimously for the Bank of England to continue with its existing programmes of UK government bond and sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, maintaining the target for the total stock of these purchases at £745 billion.

Full press release

6 August 2020: Bank of England publishes Monetary Policy Report and Financial Stability Report - August 2020

The Bank of England published its quarterly Monetary Policy Report alongside its Financial Stability Report, assessing the im act of Covid-19 on the economy in addition to the MPC’s latest projections and FPC assessment on the UK financial system.

Full press release
Monetary Policy Report - August 2020
Financial Stability Report - August 2020

6 August 2020: Bank of England publishes market notice on Asset Purchase Facility: Gilt Purchases

At its meeting ending on 4 August the MPC continued to expect the UK government bond asset purchase programme to be completed, and the total stock of purchases to reach £745 billion, around the turn of the year. The market notice sets out details of the Bank’s planned APF gilt purchases taking place from the week commencing 10 August 2020. It covers the completion of the purchases announced in June1, and the reinvestment of the proceeds of a gilt maturity occurring on 7 September 2020.

27 July 2020: Bank of England publishes Asset Purchase Facility Quarterly Report - 2020 Q2

The report contains information on the Bank of England’s Asset Purchase Facility (APF) for Q2 from 1 April 2020 to 30 June 2020. It describes the operations carried out during the period. More information on what the APF is and what it does is available in the Market Operations Guide. A short timeline describing the history of the APF is provided as background at the end of the report.

9 July 2020: Bank of England publishes minutes of Money Markets Committee meeting - 2 June 2020

The Money Markets Committee is a forum for market participants and authorities to discuss the UK unsecured deposits and funding market and securities lending and repo markets. The committee discussed market conditions and operational effectiveness during Covid-19, among other items.

Minutes

18 June 2020: Bank of England publishes market notice on Asset Purchase Facility (APF): Gilt Purchases

The Bank of England has outlined its plans of APF guilt purchasing from the week commencing 22 June 2020. It covers the completion of the purchases announced in March; the reinvestment of the proceeds of a gilt maturity occurring on 22 July 2020; and the commencement of the additional purchases announced at the MPC’s June meeting. For operations scheduled between 23 June 2020 and 6 August 2020 the size of each auction will be £1,151mn. This auction size includes the reinvestment of the £6.4bn cash flows associated with the maturity on 22 July 2020 of a gilt owned by the APF.

18 June 2020: Bank of England publishes Asset Purchase Facility Annual Report 2019/20

The Bank of England has published its Asset Purchase Facility Fund Limited Annual Report AND Accounts 2019/20.

18 June 2020: Bank of England releases Monetary Policy Summary and minutes of the Monetary Policy Committee meeting

The Bank of England’s Monetary Policy Committee (MPC) at its meeting ending on 17 June 2020, voted unanimously to maintain Bank Rate at 0.1%. The Committee voted unanimously for the Bank of England to continue with the existing programme of £200 billion of UK government bond and sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves. The Committee voted by a majority of 8-1 for the Bank of England to increase the target stock of purchased UK government bonds, financed by the issuance of central bank reserves, by an additional £100 billion, to take the total stock of asset purchases to £745 billion.

Full press release
Monetary Policy Summary and minutes of MPC 17 June 2020

5 June 2020: Bank of England publishes market notice on Asset Purchase Facility (APF): Pricing of CBPS eligible securities

The Bank of England updated the list of eligible securities for the Corporate Bond Purchase Scheme (CBPS) to include additional bonds with 3 months to maturity par call features.

Consistent with the scheme’s existing pricing approach, the Bank will continue to allocate and settle successful offers on a yield to maturity (YTM) basis. Participants should ensure that offers to sell any eligible security, including callable bonds, are submitted on a YTM basis.

22 May 2020: Bank of England publishes market notice with update on the Contingent Term Repo Facility (CTRF)

The Bank of England announced that, in light of more stable funding market conditions and recent usage patterns, it will discontinue 3-month CTRF operations at the end of May 2020. The final operation is scheduled to take place on 28 May.

The Bank will continue to offer 1-month term CTRF operations on a weekly basis at least through June 2020, with operations currently scheduled to end on 26 June. The Bank’s regular liquidity insurance facilities will continue to operate including the weekly 6-month Indexed Long-Term Repo (ILTR) and the on-demand Discount Window Facility (DWF). The indicative schedule of all the Bank’s market operations will be updated on the Information for participants page.

19 May 2020: HM Treasury and Bank of England publish joint Covid Corporate Financing Facility (CCFF) Market Notice

The Consolidated Market Notice describes the operation of HM Treasury and the Bank’s CCFF. It updates the currently effective provisions of previous Market Notices in relation to the CCFF and so replaces all previous Market Notices relevant to the facility. The CCFF will operate for as long as steps are needed to relieve cash flow pressures on firms that make a material contribution to the UK economy. The CCFF is operated by the Bank of England (the Bank) on behalf of HM Treasury.

19 May 2020: HM Treasury publishes details of an update to the terms of the Covid Corporate Financing Facility (CCFF)

Over 230 businesses are currently approved as eligible to access the CCFF. The facility has supported £18.8bnof lending to 55 businesses and authorised a further £38.8bn of potential lending including to another 68 businesses that make a significant contribution to the UK economy. The CCFF will continue to allow businesses that can demonstrate that they were in sound financial health as at 1 March 2020 to borrow from the Bank of England by issuing short-term commercial paper.

Full press release

7 May 2020: Bank of England maintains bank rate at 0.1%

MPC voted unanimously to maintain Bank Rate at 0.1%. The Committee voted by a majority of 7-2 for the Bank of England to continue with the programme of £200 billion of UK government bond and sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, to take the total stock of these purchases to £645 billion.

7 May 2020: Bank of England publishes Monetary Policy Report and Interim Financial Stability Report

The Bank published its quarterly Monetary Policy Report alongside an interim Financial Stability Report. Together, they provide a scenario for the path of the UK economy in the light of Covid-19 and assess the financial system’s resilience to that scenario.

Monetary Policy Report May 2020

Interim Financial Stability Report May 2020

2 May 2020: Bank of England publishes updates to TFSME to reflect HMT’s new Bounce Back Loans Scheme

The Bank of England announced a change to the Term Funding Scheme with additional incentives for SMEs (TFSME) to support HM Treasury’s Bounce Back Loans Scheme (BBLS). The TFSME allows eligible banks and building societies to access four-year funding at rates very close to Bank Rate.

Full press release

1 May 2020: Bank of England publish Market Notice on Asset Purchase Facility (APF) additional corporate bond purchases

The Market Notice describes the operation of the Bank of England’s Corporate Bond Purchase Scheme, covering eligible securities, eligible counterparties and applications, and its operating parameters. The Bank will publish on its website the list of eligible securities for the Scheme; the representative share for each sector; and the Banks’ holdings in each of these sectors on its website on the first Thursday of the month.

24 April 2020: Bank of England publishes market notice on extension of the Contingent Term Repo Facility (CTRF)

The Bank of England announced that it will continue to offer 3-month and 1-month term Contingent Term Repo Facility (CTRF) operations on a weekly basis through May 2020, with the final operation scheduled on 29 May.

22 April 2020: Bank of England publishes statement on increase to APF gilt lending limits

To further support gilt market functioning the Bank of England, working with the UK Debt Management Office (DMO), will increase the proportion of gilts held in the Asset Purchase Facility (APF) that are made available to the DMO to use in its market operations and for the DMO’s Standing and Special Repo Facilities.

20 April 2020: Bank of England addresses questions on the use of Liquidity and Capital Buffers

In the format of a FAQs page the Bank of England has provided further information on the usability of liquidity and capital buffers and their operation as set out in the PRA rules and guidelines and in response to the Covid-19 outbreak.

The Bank may periodically update these FAQs and, therefore, please check the website for new FAQs or revisions to a previously issued FAQ.

9 April 2020: PRA decides to maintain firms’ Systemic Risk Buffer (SRB) rates at the rate set in December 2019

In response to the economic shock from Covid-19, the Prudential Regulatory Authority (PRA), with the support of the FPC, announced its decision to maintain firms’ Systemic Risk Buffer (SRB) rates at the rate set in December 2019 and will next reassess them in Dec 2021.

See decision here

9 April 2020: PRA publishes Modification by consent of the calculation of the total exposure measure of the Leverage Ratio

The PRA is offering a modification by consent so that banks which are subject to the UK Leverage Ratio would be required to apply this article, for the purpose of PRA rules, if they choose to do so. Once a firm’s request for modification by consent takes effect, it will be required to calculate the exposure value of regular-way purchases and sales awaiting settlement in its UK Leverage Exposure Measure according to CRR2 Article 429g.

6 April 2020: Bank of England’s Term Funding Scheme to open 15 April 2020

The Bank of England announced the TFSME will open for drawings on 15 April 2020, sooner than previously anticipated. The TFSME allows eligible banks and building societies to access four-year funding at rates very close to Bank Rate.

Full press release

2 April 2020: Bank of England publishes Market Notice on Asset Purchase Facility (APF): Additional Corporate Bond Purchases

At its special meeting on 19 March 2020 the MPC judged that a further package of measures was warranted to meet its statutory objectives. In line with the MPC’s statement, the Bank intends to purchase at least £10 billion of eligible sterling non-financial corporate bonds in coming months, taking the stock of purchased corporate bonds to at least £20 billion. The Bank will keep the size of the Scheme and purchase pace under review in light of prevailing market conditions, market function and any future MPC decisions.

30 March 2020: Bank of England announces continuation of CTRF

The Bank of England announced that it will continue to offer the Contingent Term Repo Facility (CTRF) on a weekly basis through April 2020. 3-month term CTRF operations will continue to run weekly until 30 April. In addition, beginning this week there will also be a 1-month term CTRF operation each week, with the final operation scheduled on 1 May.

27 March 2020 (update from 20 March 2020): Bank of England addresses questions about the Covid Corporate Financing Facility (CCFF)

In the format of a FAQs page the Bank of England has provided further information for those seeking to participate in the CCFF scheme.

The Bank will accept CP with standard features that is issued using ICMA market standard documentation. ICMA is making generally available to non-ICMA members the Euro Commercial Paper materials from the ICMA Primary Market Handbook previously available only to ICMA members.

To support companies seeking to set up CP programmes quickly, the Bank will accept simplified versions of the commercial paper documentation, based on the ICMA standard, which are available on the Bank’s FAQ page (for ease of review, these are provided in clean and blackline to the ICMA recommended templates where appropriate).

The Bank may periodically update these FAQs and, therefore, please check the website for new FAQs or revisions to a previously issued FAQ.

24 March 2020: Bank of England launches Contingent Term Repo Facility (CTRF) and publishes CTRF Activation Market Notice

In response to financial market conditions the Bank of England has activated the Contingent Term Repo Facility (CTRF) - a temporary enhancement to its sterling liquidity insurance facilities. The CTRF is a flexible liquidity insurance tool that allows participants to borrow central bank reserves (cash) in exchange for other, less liquid assets (collateral).

The Bank’s liquidity insurance facilities support financial market functioning by providing market participants with predictable and reliable sources of liquidity as well as supporting financial stability by reducing the cost of disruption to critical financial services.

CTRF operations will run on 26 March 2020 and 2 April 2020, in addition to the Bank’s regular liquidity insurance facilities including the Indexed Long-Term Repo (ILTR) and Discount Window Facility (DWF).

The size of the CTRF operations will be unlimited, and the price will be a fixed rate of Bank Rate plus 15bps with a term of 3 months.

19 March 2020: MPC announces further rate cut and additional purchases of UK government and non-financial corporate bonds

At a special meeting on 19 March, the MPC judged that a further package of measures was warranted to meet its statutory objectives. It therefore voted unanimously to increase the Bank of England’s holdings of UK government bonds and sterling non-financial investment-grade corporate bonds by £200 billion to a total of £645 billion, financed by the issuance of central bank reserves.

The majority of additional asset purchases will comprise UK government bonds. The purchases will be completed as soon as is operationally possible, consistent with improved market functioning. The Bank will issue further guidance to the market in due course.

The MPC also voted unanimously to reduce the Bank Rate by 15 basis points to 0.10%. 

The Committee further voted unanimously that the Bank of England should enlarge the TFSME scheme, financed by the issuance of central bank reserves.

17 March 2020: HM Treasury and the Bank of England launch a Covid Corporate Financing Facility (CCFF)

The CCFF will provide funding to businesses by purchasing commercial paper of up to one-year maturity, issued by firms making a material contribution to the UK economy. It will help businesses across a range of sectors to pay wages and suppliers, even while experiencing severe disruption to cashflows.

The facility will offer financing on terms comparable to those prevailing in markets in the period before the COVID-19 economic shock, and will be open to firms that can demonstrate they were in sound financial health prior to the shock.  The facility will look through temporary impacts on firms’ balance sheets and cash flows by basing eligibility on firms’ credit ratings prior to the COVID-19 shock. Businesses do not need to have previously issued commercial paper in order to participate.

The scheme will operate for at least 12 months and for as long as steps are needed to relieve cash flow pressures on firms that make a material contribution to the UK economy. The Bank will publish further details of the operation of the CCFF in a Market Notice on Wednesday 18 March. The Bank will implement the facility on behalf of the Treasury and will put it into place as soon as possible.

By providing an alternative source of finance for a wide range of companies, the scheme will help to preserve the capacity of the banking system to lend to other companies, including small and medium-sized enterprises, which rely on banks.

11 March 2020: FPC releases the UK Countercyclical Capital Buffer

To support further the ability of banks to supply the credit needed to bridge a potentially challenging period, the Financial Policy Committee (FPC) has reduced the UK countercyclical capital buffer rate to 0% of banks’ exposures to UK borrowers with immediate effect. The rate had been 1% and had been due to reach 2% by December 2020.

The FPC expects to maintain the 0% rate for at least 12 months, so that any subsequent increase would not take effect until March 2022 at the earlies

The release of the countercyclical capital buffer will support up to £190 billion of bank lending to businesses. That is equivalent to 13 times banks’ net lending to businesses in 2019.

In addition, the Prudential Regulation Authority (PRA) has today set out its supervisory expectation that banks should not increase dividends or other distributions, such as bonuses, in response to these policy actions.

11 March 2020: MPC reduces Bank Rate and launches new Term Funding Scheme with additional incentives for SMEs

At its special meeting ending on 10 March 2020, the Monetary Policy Committee (MPC) voted unanimously to reduce Bank Rate by 50 basis points to 0.25%.  The MPC voted unanimously for the Bank of England to introduce a new Term Funding scheme with additional incentives for Small and Medium-sized Enterprises (TFSME), financed by the issuance of central bank reserves. The MPC voted unanimously to maintain the stock of sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, at £10 billion. The Committee also voted unanimously to maintain the stock of UK government bond purchases, financed by the issuance of central bank reserves, at £435 billion

            Switzerland:

17 December: SNB publishes monetary policy assessment

The Swiss National Bank (SNB) is maintaining its expansionary monetary policy with a view to stabilising economic activity and price developments. The SNB is keeping the SNB policy rate and interest on sight deposits at the SNB at −0.75%.

Full press release

24 September 2020: SNB publishes monetary policy assessment

The SNB is maintaining its expansionary monetary policy. In so doing, it aims to cushion the negative impact of the pandemic on economic activity and inflation. The SNB is keeping the SNB policy rate and interest on sight deposits at the SNB at −0.75%. In view of the fact that the Swiss franc is still highly valued, the SNB remains willing to intervene more strongly in the foreign exchange market, while taking the overall exchange rate situation into consideration. The SNB continues to supply the banking system with generous amounts of liquidity via the SNB COVID-19 refinancing facility (CRF). It is also active on the repo market as needed.

Full press release

18 June 2020: SNB releases Monetary Policy Assessment

The Swiss National Bank (SNB) released its Monetary Policy Assessment, acknowledging its expansionary monetary policy remains necessary to ensure appropriate monetary conditions in Switzerland. The SNB is keeping the SNB policy rate and interest on sight deposits at the SNB at −0.75%, and in light of the highly valued Swiss franc it remains willing to intervene more strongly in the foreign exchange market. In so doing, it takes the overall exchange rate situation into account. Furthermore, under the SNB COVID-19 refinancing facility (CRF), it is providing the banking system with additional liquidity and thus supporting the supply of credit to the economy at favourable terms.

Full press release

11 May 2020: SNB CRF expanded to include cantonal loan guarantees as well as joint and several loan guarantees for startups

The Swiss National Bank announced the expansion of accepted collateral for the COVID-19 refinancing facility (CRF). The CRF will now additionally accept claims secured by loan guarantees or credit default guarantees offered by cantons, provided these have been granted in order to cushion the economic impact of the COVID-19 pandemic.

Full press release

Instruction sheet on SNB COVID-19 refinancing facility (CRF)

25 March 2020: Swiss National Bank introduces new COVID-19 refinancing facility (CRF)

The Swiss National Bank (SNB) has introduced the new SNB COVID-19 refinancing facility (CRF). This measure is aimed at strengthening the supply of credit to the Swiss economy by providing the banking system with additional liquidity. There is no upper limit on the amounts available under the CRF, and drawdowns can be made at any time. The CRF operates in conjunction with the federal government’s guarantees for corporate loans. The facility allows banks to obtain liquidity from the SNB, which is secured by the federally guaranteed loans. The SNB thereby enables banks to expand their lending rapidly and on a large scale and, at the same time, to access the required liquidity. The interest rate for these refinancing transactions corresponds to the SNB policy rate. Under the CRF, the SNB can also conduct additional refinancing transactions in order to supply the banking system with further liquidity if required. The SNB has also submitted a proposal to the Federal Council requesting that the countercyclical capital buffer be reduced to 0% with immediate effect.

19 March 2020: SNB Monetary policy assessment Press Release

SNB maintains expansionary monetary policy, raises negative interest exemption threshold, and is examining additional steps

According to the SNB, it believes its expansionary monetary policy is more necessary than ever for ensuring appropriate monetary conditions in Switzerland. It is keeping the SNB policy rate and interest on sight deposits at the SNB at −0.75%. The SNB is intervening more strongly in the foreign exchange market to contribute to the stabilisation of the situation. In so doing, it takes the overall exchange rate situation into account. Negative interest and interventions are necessary to reduce the attractiveness of Swiss franc investments and thus counteract the upward pressure on the currency.

The SNB will also provide liquidity as part of the extended swap arrangements with other central banks, particularly in US dollars.

Finally the SNB is examining whether a relaxation of the countercyclical capital buffer would be possible despite the risks to the mortgage and real estate markets.

            Sweden

19 February 2021: Riksbank releases minutes of the monetary policy meeting held on 9 February 2021

At the Monetary Policy Meeting on 9 February, the Executive Board of the Riksbank decided to hold the repo rate unchanged at zero per cent. To provide support to the recovery and inflation, the Riksbank is also continuing to purchase assets within the envelope of SEK 700 billion and to offer liquidity within all the programmes launched in 2020.

Full press release
Minutes
See also: Monetary Policy Report, February 2021

10 February 2021: Riksbank publishes statement on asset purchases and zero interest rate

To facilitate the recovery and help inflation rise towards the target, monetary policy needs to remain expansionary. The Riksbank is therefore continuing to purchase assets within the envelope of SEK 700 billion. The repo rate is being left unchanged at zero per cent.

Full press release

7 December 2020: Riksbank releases minutes of the monetary policy meeting held on 25 November 2020

At the monetary policy meeting on 25 November, the Executive Board of the Riksbank decided to expand and extend the asset purchase programme from SEK 500 billion up to SEK 700 billion up until 31 December 2021 and to hold the repo rate unchanged at zero per cent.

Full press release

26 November 2020: Riksbank publishes statement on zero policy rate and extended asset purchases

The increased spread of infection and tighter restrictions will lead to a new downturn in the Swedish economy. To give further support in an uncertain time, improve the conditions for a recovery and help inflation rise towards the target of 2 per cent, the Executive Board has decided to expand and extend the Riksbank’s asset purchases from SEK 500 billion to up to SEK 700 billion up to 31 December 2021. The repo rate is held unchanged at zero per cent and is expected to remain at this level in the coming years.

Full press release

17 November 2020: Riksbank initiates corporate bond purchases via auctions and increases transparency

The Riksbank's purchases of corporate bonds have so far been made through a bilateral purchase procedure. On 2 December, the Riksbank will also begin purchasing corporate bonds via auctions. This means that the Riksbank's continued purchases will be made both through bilateral purchases and through auctions. Further information on the Riksbank’s corporate bond purchases via auctions can be found in the general terms and conditions on the Riksbank's website.

Full press release

1 October 2020: Riksbank releases minutes of the monetary policy meeting held on 21 September 2020

At the Monetary Policy Meeting on 21 September, the Executive Board of the Riksbank decided to hold the repo rate unchanged at zero per cent. The Riksbank’s zero policy rate and extensive programme of measures are providing continued support to economic developments and helping inflation rise towards the target.

Full press release

22 September 2020: Riksbank measures programme and low interest rate support the recovery

To provide support to economic developments and help inflation to rise towards the target, the Riksbank is continuing its asset purchases and offering liquidity in all the programmes launched so far this year. The repo rate is held unchanged at zero per cent and is expected to remain at this level in the coming years. The programmes have had a calming effect on financial markets and helped to keep interest rates to households and companies low in the crisis.

Full press release
Monetary policy report - September 2020

1 September 2020: Riksbank to begin purchasing corporate bonds in September

The Executive Board of the Riksbank has decided to initiate purchases of corporate bonds in the week beginning 14 September 2020. The purchases will keep companies’ funding costs down and reinforce the Riksbank’s capacity to act if the credit supply to companies were to deteriorate further as a result of the corona pandemic.

Full press release

10 July 2020: Riksbank publishes minutes of the Monetary Policy Meeting held on 30 June 2020

At the monetary policy meeting on 30 June, the Executive Board of the Riksbank decided on further monetary policy measures to alleviate the economic consequences of the pandemic and help the economy and inflation to recover. The framework for the asset purchases the Riksbank has been making since the beginning of the crisis is increased from SEK 300 billion to SEK 500 billion and the programme is extended to the end of June 2021. In September, the Riksbank will also begin purchasing corporate bonds. The Executive Board has further decided to cut interest rates and extend maturities on the lending to the banks. The repo rate was held unchanged at zero per cent.

Full press release

1 July 2020: Riksbank outlines further measures to alleviate the economic consequences of the pandemic

To avoid an unnecessarily prolonged and deep decline in the economy and inflation, the Executive Board has decided on several measures. The framework for the asset purchases made by the Riksbank since the crisis began is being extended from SEK 300 billion to SEK 500 billion up to the end of June 2021. In September, the Riksbank will also begin purchasing corporate bonds. The Executive Board has further decided to cut interest rates and extend maturities on lending to banks. At the same time, the repo rate is held unchanged at zero per cent.

Full press release

            China

27 August 2020: PBC announces CBS Operation

The People's Bank of China (PBC) conducted a central bank bills swap (CBS) operation on August 27, 2020 in order to improve the liquidity of bank-issued perpetual bonds, support banks to replenish capital through perpetual bond issuance, and enable the financial sector to better serve the real economy. The operation registered RMB5 billion, with a term of three months and a rate of 0.10 percent.

Full press release

Result of Central Bank Bills Swap (CBS) Operation No.8 [2020]

27 August 2020: PBC announces open market operations No.168 [2020]

In order to keep the liquidity in the banking system adequate at a reasonable level, the People’s Bank of China (PBC) conducted reverse repo operations in the amount of RMB100 billion through rate-bidding on August 27, 2020

Full press release

24 April 2020: PBOC conducts 56.1 billion yuan Targeted Medium-term Lending Facility operation

PBOC injected 56.1 billion yuan into the market via its Targeted Medium-term Lending Facility (TMLF). The facility has a maturity of one year and an interest rate of 2.95%, 20bps lower than 3.15%, the rate of the previous TMLF operation.

21 April 2020: PBOC conducts Central Bank Bills Swap

In order to improve the liquidity of FI perpetual bond market and support banks in issuing perpetual bonds to replenish capital and lend to the real economy, PBOC conducted a RMB 5 billion Central Bank Bills Swap on 21 April. The tenor was 3 months with a rate of 0.10%.

15 April 2020: PBOC monetary policy actions (in Chinese)

The People's Bank of China conducted a Medium-term Lending Facility (MLF) operation of 100 billion yuan, cutting the MLF rate by 20bps on 15 April.

On the same day, it lowered the deposit reserve requirement ratio (RRR) by 0.5% for rural financial institutions and urban commercial banks operating only in provincial administrative areas, implementing the first phase of its policy announced on 3 April. This first round of RRR adjustment for small and medium banks released about 200 billion yuan of long-term funds.

3 April 2020: PBOC reduces reserve requirements for small and medium banks

PBOC announced it will reduce the reserve requirement ratio (RRR) for small and medium banks on 15 April and 15 May, each time by 0.5%. This is expected to release RMB 400 billion in long-term funds. After the cut, the deposit reserve ratio for small and medium banks will be 6%. PBOC will also reduce the interest rate on excess reserves of FIs at the central bank from 0.72% to 0.35%, effective 7 April.

3 April 2020: Open market operation rate: 2.20% for 7-day

From 3 February 2020 to 31 March 2020, the People's Bank of China has conducted a total of more than 3.1 trillion yuan open market operations with reverse repo and its medium term lending facility to ensure sufficient liquidity supply.

25 March 2020: People’s Bank of China central bank bills swap
In order to improve the liquidity of FI perpetual bond market and support banks in issuing perpetual bonds to replenish capital and lend to the real economy, PBOC conducted a RMB 5 billion Central Bank Bills Swap. The tenor was 3 months and rate 0.10%. A similar operation was conducted on 28 February 2020.

13 March 2020: People’s Bank of China to implement targeted reserve requirement ratio (RRR) cuts for eligible banks

The measures, effective 16 March, are intended to release RMB 550 billion of long-term funds. Banks that meet certain criteria will be entitled to 50 to 100 basis points of RRR cuts. In addition, eligible joint-stock commercial banks will be given an additional targeted RRR cut of 100 basis points to support lending.

7 February 2020: PBOC conducted a RMB 1.7 trillion open market operation with reverse repo to ensure sufficient liquidity supply

Since early February, China regulators have introduced dozens of other interim measures in response to the effects of the coronavirus, those most relevant to the capital markets are:

NAFMII, Shanghai Stock Exchange, Shenzhen Stock Exchange have generally streamlined onshore bond approvals by facilitating online and remote applications. In Hubei province, corporate bond issuers have been allowed fast-track approvals.
CSRC (securities regulator) will allow more flexibility and potential extensions of deadlines for disclosure of listed companies; and in some cases reduce listing fees.

The Introduction of the Special Funds-Supplying Operations to Facilitate Corporate Financing regarding the Novel Coronavirus (COVID-19)
The Bank decided, by a unanimous vote, to introduce a new operation to provide loans against corporate debt (of about 8 trillion yen as of end-February 2020) as collateral at the interest rate of 0 percent with maturity up to one year. Twice as much as the amount outstanding of the loans will be included in the Macro Add-on Balances in current accounts held by financial institutions at the Bank. This operation will be conducted until the end of September 2020.
Increase in purchases of CP and corporate bonds

a reduction in the cash rate target to 0.1 per cent
a reduction in the target for the yield on the 3-year Australian Government bond to around 0.1 per cent
a reduction in the interest rate on new drawings under the Term Funding Facility to 0.1 per cent
a reduction in the interest rate on Exchange Settlement balances to zero
the purchase of $100 billion of government bonds of maturities of around 5 to 10 years over the next six months.

A reduction in the cash rate target to 0.25 per cent.
A target for the yield on 3-year Australian Government bonds of around 0.25 per cent.
A term funding facility for the banking system, with particular support for credit to small and medium-sized businesses.
Exchange settlement balances at the Reserve Bank will be remunerated at 10 basis points, rather than zero as would have been the case under the previous arrangements.

keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4.0 per cent.
Consequently, the reverse repo rate under the LAF remains unchanged at 3.35 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 4.25 per cent.
The MPC also decided to continue with the accommodative stance as long as it is necessary to revive growth and mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target going forward.

reduce the policy repo rate under the liquidity adjustment facility (LAF) by 40 bps to 4.0 per cent from 4.40 per cent with immediate effect (see separate press release);
accordingly, the marginal standing facility (MSF) rate and the Bank Rate stand reduced to 4.25 per cent from 4.65 per cent (separate press release); and
the reverse repo rate under the LAF stands reduced to 3.35 per cent from 3.75 per cent (separate press release).
The MPC also decided to continue with the accommodative stance as long as it is necessary to revive growth and mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target.

expanding liquidity in the system sizeably to ensure that financial markets and institutions are able to function normally in the face of COVID-related dislocations;
reinforcing monetary transmission so that bank credit flows on easier terms are sustained to those who have been affected by the pandemic;
easing financial stress caused by COVID-19 disruptions by relaxing repayment pressures and improving access to working capital; and
improving the functioning of markets in view of the high volatility experienced with the onset and spread of the pandemic. The policy initiatives in this section should be read in conjunction with the MPC’s decision on monetary policy actions and stance in its resolution.

300 million QR for three months at an interest rate of 0.20%
200 million QR for six months at an interest rate of 0.29%
100 million QR for nine months at an interest rate of 0.35%

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