Eurozone banks highlighted the improvement in financial market conditions yesterday when they abstained completely from bidding for dollar liquidity in a European Central Bank offer.
For the first time in its 11-year history, the ECB reported zero interest in a liquidity-providing operation. It had offered eurozone banks unlimited dollar funds for an 84-day period as part of measures originally announced in the wake of the collapse of Lehman Brothers investment bank in September last year.
