Commercial Paper Nosedives

Outstanding volume falls of by more than $31 billion this week.

The commercial paper market shrunk for the fifth straight week, this time by $31.5 billion, to $1.554 trillion, for the week ended Wednesday. Last week, the market contracted by just $4.4 billion.

Commercial paper issued by financial companies fell by $23.7 billion, or 3.7 percent, to $613.2 billion. Non-financial issues slumped by $10.2 billion.

One silver lining: Asset-backed commercial paper — which accounts for nearly half of the total CP market — increased slightly, to $736 billion.

The total commercial paper market is down from $1.82 trillion more than four months ago and its peak of $2.2 trillion during the summer of 2007.

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