PRESS RELEASE

Indicative calendar for the Eurosystem's tender operations in the year 2000 including an adjustment to smooth the century date change

23 September 1999

The European Central Bank (ECB) is today releasing to the public the indicative calendar for the Eurosystem's tender operations in 2000 [annex, pdf 26 kB].

The indicative calendar is prepared in compliance with the procedures set out in the "General documentation on ESCB monetary policy instruments and procedures" (dated September 1998). The ECB aims at establishing conditions ensuring that counterparties in all Member States can participate in the main and the longer-term refinancing operations. Therefore, when compiling the calendar for these operations, the ECB has made appropriate adjustments to take into account bank holidays in the individual Member States.

Attention should be drawn to one particular aspect of the indicative calendar relating to the transition to the year 2000. As already pointed out in a previous press release, the ECB is convinced that the Eurosystem's monetary policy framework is flexible enough and has built-in mechanisms designed to deal with any level of liquidity demand that might arise in the euro markets. In addition different scenarios have been analysed and the conclusion has consistently emerged that the Eurosystem will be in a position to cope with any potential increase in the demand for liquidity: the stock of banknotes held by national central banks is sufficient to allow for a considerable additional demand for banknotes in circulation and the amount of collateral available in the Eurosystem will be sufficient to allow for the corresponding increase of refinancing needs of the banking system. Nonetheless, it is considered prudent to eliminate any potential problem that may derive from the maturing and renewal of a main refinancing operation in the first week of the year 2000. Thus, no new main refinancing operation will be initiated in the first week of the year 2000, and no such operation will mature during this week. In fact the maturity of the main refinancing operation of 21 December 1999 will be lengthened exceptionally to three weeks. To avoid that two main refinancing operations mature on 12 January 2000, the operation of 30 December 1999 will also be lengthened to three weeks. This adaptation, which is consistent with the overall set-up, is considered useful to minimise any potential problem for counterparties and for the financial market, which could result from the conduct and settlement of a large operation directly after the transition to the new century.

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