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Fed sets rates for commercial paper facility

Fed sets rates for commercial paper facility

The Federal Reserve says it is currently asking a rate of 1.88 percent to buy unsecured commercial paper.
For asset-backed commercial paper, the Fed is asking a rate of 3.88 percent.
The Fed said earlier this month it would start buying commercial paper Monday to bolster the market. Commercial paper is the short-term debt that companies sell to finance day-to-day operations such as supplies or payrolls. Sometimes it is unsecured; other times, it is backed by assets such as mortgages.
Demand for the paper dried up after Lehman Brothers Holdings Inc.'s bankruptcy and other troubles in the global banking system.


Updated : 2021-04-12 03:02 GMT+08:00