The ECB registered a substantial fall in CBPP3 purchases last week, with gross purchases of some EUR822m little more than a quarter of those the previous week. This came on the back of a much less issuance, with secondary market purchases up slightly but still below the 2017 average.

According to figures released on Monday, settled and outstanding purchases under the third covered bond purchase programme increased EUR222m in the week to last Friday, from EUR244.852bn to EUR245.074bn. Figures released yesterday (Tuesday) show that around EUR600m of CBPP3 holdings matured last week, implying that gross purchases totalled around EUR822m.

This is down from gross purchases of EUR3.063bn in the previous week and below the 2017 average of EUR1.1bn per week.

The share of net CBPP3 settlements in the week-on-week growth of the overall asset purchase programme (APP) portfolio fell from 32.5% – its highest level since the public sector purchase programme (PSPP) began in March 2015 – to just 3%. However, CBPP3’s share of gross APP purchases was more substantial, at around 15%.

Analysts attributed the fall in purchases to the Eurosystem having fewer options on the primary market. Three CBBP3-eligible benchmark deals settled last week, amounting to EUR1.75bn of supply, down from EUR8.875bn in the previous week.

Analysts estimate the Eurosystem bought around EUR500m of last week’s settlements on the primary market. This would imply that secondary market purchases averaged around EUR64m per day, up from an estimated EUR12m per day in the previous week, but still well below the 2017 average of around EUR140m per day.