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maltatoday, WEDNESDAY, 16 SEPTEMBER 2015 11 Business Today www.creditinfo.com.mt info@creditinfo.com.mt Tel: 2131 2344 Your Local Partner for Credit Risk Management Solutions Supporting you all the way Money Market Report for the week ending September 11, 2015 ECB Monetary Operations On Monday, September 7, the European Central Bank (ECB) announced its weekly main refinancing operation (MRO). The auction was conducted on Tuesday, September 8, and attracted bids from euro area eligible counterparties of €70.91 billion, €0.13 billion lower than the bid amount of the previous week. The amount was allotted in full at a fixed rate equivalent to the prevailing MRO rate of 0.05%, in accordance with current ECB policy. On Wednesday, September 9, the ECB conducted a seven-day US dollar funding operation through collateralised lending in conjunction with the US Federal Reserve. This operation attracted bids of $0.14 billion, which was allotted in full at a fixed rate of 0.66%. Domestic Treasury Bill Market In the domestic primary market for Treasury bills, the Treasury invited tenders for 90-day bills maturing on December 10, 2015. Bids of €18.00 million were submitted, with the Treasury accepting all bids. Since €15.00 million worth of bills matured during the week, the outstanding balance of Treasury bills increased by €3.00 million, to stand at €240.05 million. The yield from the 90-day bill auction was 0.017%, down by 1.3 basis points from bids with a similar tenor issued on September 4, 2015, representing a bid price of 99.9958 per 100 nominal. During the week under review, there was no trading on the Malta Stock Exchange. On Tuesday the Treasury invited tenders for 90-day bills and 272- day bills maturing on December 17, 2015, and June 16, 2016, respectively. Market commentary: Currencies, markets and Central Banks With a pivotal Federal Reserve meeting scheduled this week, equity markets continue to trade without a clear direction, with investors often taking profi ts as soon as stocks at- tempt to rally higher. Yesterday all major indices across the globe closed in negative territory, erasing part of the gains recorded last week, or extending losses posted on Friday. While European markets opened higher on Monday morning, both Asia and US closed their latest sessions in the red, with the Shanghai Composite Index booking another sizable daily loss, dropping over 3% during overnight trading. As all investors prepare themselves for the FOMC meeting on Thursday, when the US Central Bank might finally decide to pull the trigger on its first interest rate hike since the 2008 financial crisis, currencies and diverging monetary policies took the spot light once again, with analysts returning to discuss current market dynamics. The major topic of discussion is still the remarkable appreciation of the US dollar, which continues to be among the best performers within the currency markets, as many do not see the US currency reversing its uptrend any time soon. Over the past 24 months, the US dollar has gained as much as 20% over the Japanese Yen and 17% over the Euro, driven by better economic fundamentals in the US, and a recent flight to safety in response to an unusually high and prolonged volatility in the markets. With the greenback just 8% short of its record high reached in February 2002, economists and analysts alike are now pointing out the potential negative impacts that such a strong currency may eventually have on US corporate earnings, overall growth and country's inflation. Moreover, the recent one-direction appreciation of the dollar, which has been gaining against pretty much all other major currencies, comes at a time when global coordination in the currency markets is rather elusive, if not completely non- existent. In fact, while the current prolonged appreciation resembles the greenback run up in 1984, this time diverging monetary policies around the world are not helping the US in its attempt to talk down the dollar. With Europe and Japan in the middle of extended QE programs, commodities related currencies such as the Australian and Canadian dollars in free fall, and emerging currencies already under pressure, analysts do not believe the US currency will stop outperforming its peers. While the Federal Reserve is expected to have a hard time deciding whether the negative impacts of a strong dollar would outweigh calls for the beginning of a normalization in interest rate policies, on the other side of the Pacific, the Bank of Japan opted to refrain from adding new monetary stimulus on top of the extended number of easing measures already implemented. Japan's Central Bank decision to sit and hope for a natural resumption in growth, despite the country's economy shrank during the second quarter of the year and Japan's inflation remains close to zero, has provided some support for the Yen, and put additional pressure on Prime Minister Shinzo Abe to propose a fiscal package able to support a second half of the year's lackluster recovery, an extension of the current Abenomics plan. Japanese stocks closed modestly up this morning, adding about 0.34%, while the Yen gained against the US dollar and the Euro, supported by the Central Bank decision not to boost stimulus. US equity futures point to a weak opening as investors remain focused on the willingness of Central Bank's Governor Haruhiko Kuroda to step up monetary support for the country's economy and the market reaction to a potential US interest rate hike decision coming later on this week. Disclaimer: This article was issued by Paolo Zonno, Trader/Analyst at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, views and opinions provided in this article are being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri & Co. Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing in this article. Nintendo appoints new president Long-serving Nintendo execu- tive Tatsumi Kimishima will be appointed president of the fi rm following the death in July of Satoru Iwata. Kimishima has been a managing director at the firm since June 2013, and joined in 2000. The company said several new appointments were part of a "large-scale revision" of Nintendo's organisational structure. The changes will come into effect on Wednesday. Kimishima was a managing director of the company in charge of corporate analysis, general affairs and human resources divisions. He has been at Nintendo since 2000 when he was appointed director of its Pokemon business. A new title of "Creative Fellow" was announced for game designer and senior managing director Shigeru Miyamoto. Another senior executive, Genyo Takeda, was given the title "Technology Fellow." Nintendo said the titles were meant to convey his roles in providing advice and guidance. Iwata, who was president from 2002, was highly revered on the Japanese gaming scene. He was considered the leading figure behind some of Nintendo's most popular devices from 2000, when he joined the company. He led Nintendo into the rapidly growing mobile gaming sector.