Apart from holding back its benchmark interest rate, the European Central Bank (ECB) has also added liquidity injections to the financial system. The ECB increased the value of the purchase of bonds worth 500 billion Euros amidst widespread lockdowns due to the second wave of Corona. This has caused excess liquidity to flow to emerging markets, such as Government Securities (SBN), because they still offer attractive yields. The interest rates for the main refinancing operation, marginal loan facility and ECB deposit facility remained at the level of 0.00%, 0.25% and -0.5%, respectively. At the end of the week, all benchmark series posted yield cuts, with the FR0083 the most in more than 7 bps. Investors are also interested in FR0086 and FR0087, which recorded a drop in yields of 0.2 bps and 3.3 bps, respectively.
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