PRESS RELEASE

The Eurosystem will conduct a liquidity-absorbing fine-tuning operation on 5 January 2000

4 January 2000

The ECB has decided to conduct a liquidity-absorbing fine-tuning operation on 5 January 2000, with same day settlement and maturity on 12 January 2000. The operation will be specified as a collection of fixed-term deposits and will be processed as a quick tender procedure with a variable rate. Bids at an interest rate up to a maximum of 3.00% will be accepted for submission. The intended allotment volume, which will be specified tomorrow in the tender announcement to be issued at 11 a.m., will be around EUR 35 billion. Counterparties selected for fine-tuning operations will be invited to participate.

The prevailing liquidity situation reflects the ECB's commitment to prevent liquidity constraints from occurring during the transition to the year 2000, as well as the substantial expansion of liquidity provided by autonomous factors at the beginning of the year. As the transition to the year 2000 went smoothly, the ECB now considers it appropriate to adjust the liquidity situation accordingly. This decision takes into account the fact that the next main refinancing operation will not take place until 12 January 2000, as the ECB decided in September 1999 to eliminate, on prudence grounds, the maturing and renewal of main refinancing operations during the first week of this year.

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