Total commercial paper rose again last week, but posted its smallest weekly gain in more than a month, according to Federal Reserve data.

Total outstanding commercial paper climbed by 8.3 billion, to $1.709 trillion for the week ended Wednesday. Virtually all the gains were posted by financial issuers, increasing by more than $15 billion. This was still less than half the total increase the prior week, however.

The financial sector now accounts for more than 44 percent of the total outstanding commercial paper issues. Meanwhile, outstanding paper issued by nonfinancial companies slumped by 7.3 billion, while asset-backed paper was flat.

Interestingly, the market for lower rated paper continues to improve. Among A2/P2 nonfinancial paper, considered to be the most risky, average daily volume is up more than 40 percent since the end of November alone.

The total commercial paper market still is down from $1.82 trillion three months ago and the peak of $2.2 trillion during the summer of 2007.