By calibrating the amount of liquidity to be auctioned in the MROs so that it was just enough to meet the system’s expected demand for cash balances at the intended main refinancing rate (MRO rate), the ECB could steer the market rate for overnight liquidity close to the MRO rate during the pre-crisis period.
Indeed, in that era, our prime overnight market rate, the euro overnight index average (EONIA), was fluctuating closely around the MRO rate. The MRO is complemented by the two standing facilities which form the monetary policy corridor.