U.S. Commercial Paper Market Up $19.7 Billion This Week But Still Down 50% From Peak
Editor’s Note: This is promising data showing investor’s appetite for corporate debt and signs that companies are preparing for a recovery. Job numbers can out today and surprised the analysts by raising the unemployment rate to 9.8%. Interesting that the market is still down by about 50% to $1.08 trillion from the peak at $2.2 trillion dollars in the summer of 2007. It mentioned that the commercial paper market has been shrinking because these companies have found cheaper sources of funding, where is a cheaper source of funding? Maybe, direct from the Federal Reserve?
Dow Jones, New York - The U.S. commercial paper market increased for the seventh consecutive week this week, according to data released Thursday by the Federal Reserve.
Federal Reserve: Commercial Paper Outstanding Rises By $10.7 Billion This Week
Dow Jones, New York - The U.S. commercial paper market increased this week, reversing course after several weeks of declines, according to data released by the Federal Reserve Board on Thursday. This week, the outstanding level went up by $10.7 billion, after a decline of $27.6 billion last week.
The asset-backed portion of this short-term market did fall, though, by $3 billion. Last week, this part of the market grew by $900 million on a seasonally adjusted basis, after shrinking by $4.6 billion in the prior week.
U.S. commercial paper market recovers a bit compared to last week
The size of the U.S. commercial paper market rebounded slightly in the latest week after last week’s huge drop, suggesting some stability in this critical part of the credit market.
These short-term IOU’s – which many companies rely on to fund their daily operations — rose $3.9 billion to $1.484 trillion in the week ended Wednesday, according to Federal Reserve data released on Thursday. It fell $44.2 billion in the prior week.