The Eurosystem kept its secondary market covered bond purchases at an elevated level into the second week of November, ECB figures show, registering Eu853m of secondary purchases last week while no primary issuance settled. However, analysts cautioned against interpreting the figures as a reinforcement of CBPP3.

ECB figures released on Monday show that settled and outstanding purchases under CBPP3 increased from Eu198.663bn to Eu199.516bn in the week to last Friday.

Figures published yesterday (Tuesday) afternoon show there were no redemptions in the CBPP3 portfolio last week, implying that gross purchases were the same as the net portfolio growth of Eu853m. This compares with gross purchases of around Eu1.217bn in the previous week, when Eu200m of CBPP3 holdings matured.

No CBPP3-eligible deals settled last week, implying that secondary market purchases averaged Eu171m per day. This compares with an average of around Eu187m per day (based on an estimated total of around Eu935m) in the previous week.

ECB figures in the first two weeks of November have thus reflected secondary purchases markedly higher than for most of October. The ECB bought around Eu2.3bn on the secondary market in the whole of last month, with purchases falling in the last three weeks of the month to range between Eu490m and Eu590m per week, according to analysts’ estimates.

However, Maureen Schuller, head of financials research at ING, noted that secondary purchases were approximately in line with the last two weeks in which no CBPP3-eligible issuance settled – the week ending 26 August, when Eu849m was bought, and the week ending on 23 September, when Eu868m was bought.

“Hence in our view, this marks no signal of a noteworthy sustainable stronger purchase pace,” she said.