PRESS RELEASE
Bank of Albania interventions in the money market and foreign exchange market over 2014 Q3

1.1 Open market operations

Money market interventions during 2014 Q3 consisted of open market operations for temporary liquidity injection and permanent operations for structuring Bank of Albania's portfolio.

The total amount of injected liquidity averaged ALL 28.06 billion, from ALL 20.61 billion injected in 2014 Q2. Average injected liquidity was around 61% higher than in the previous year, when it amounted to around ALL 17.38 billion.  

To inject temporary liquidity, the Bank of Albania employed its main instrument, the one-week reverse repurchase agreement - on average, ALL 25.80 billion a week*, and the one-month reverse repurchase agreement, on average, ALL 2.07 billion a week*. The overnight injection operation on 22.08.2014 aimed at closing the period with positive balance, avoiding therefore the start of the new period at a high balance.

In 2014 Q3, outright transactions continued, aiming at lowering BoA's participation in T-bills up to 70% of total issue. Since BoA's portfolio during the first half of 2014 was up ALL 50 million from year start, in the third quarter an auction was organised to purchase 12-month newly issued Treasury bills for the announced amount of ALL 400 million, followed by downward reinvestment in 6-month Treasury bills for ALL 450 million. The purchase intervention was realised for only ALL 270 million. Following, three open market interventions were carried out to purchase 12-month newly issued Treasury bills, realised for ALL 465 million, in part adjusted by a sale intervention for ALL 250 million. At the end of the third quarter, BoA's portfolio stood ALL 85 million higher than at the beginning of 2014.

1.2 Use of standing facilities

The overnight deposit facility was used 27 times, averaging ALL 2.07 billion, against 6 times as in the previous quarter, when it averaged ALL 0.11 billion. The overnight loan was used once, on 22 August, for the amount ALL 225 million, against six times in the previous quarter, for ALL 450 million, on average. Chart 1 summarises Bank of Albania interventions in the money market during 2011-2014.