Total outstanding commercial paper fell $7.5 billion in the week ended this past Wednesday, to $1.476 trillion, according to the Federal Reserve. But financial issuers recorded their second straight weekly gain, expanding by $10.8 billion to $587.3 billion, after growing by $8.2 billion the prior week.
On the other hand, the total outstanding among asset-backed issuers fell for the second straight week. In the period ended this past Wednesday alone, the asset-backed market contracted by more than $17 billion, to less than $700 billion.
Even so, asset-backed issuers still account for the largest segment of commercial paper issuers, followed by financial issuers and non-financial issuers.
The total commercial paper market peaked at $2.2 trillion during the summer of 2007.
Some observers are not too concerned that the commercial paper market in general has been contracting in recent weeks.
They asserts that the fall in paper could suggest that issuers are eschewing the short-term financing market to lock in longer-term financing in the bond market, which has a new-issue market that has bulged this year.