NEW YORK - THE Federal Reserve says it is currently asking a rate of 1.88 per cent to buy unsecured commercial paper.
For asset-backed commercial paper, the Fed is asking a rate of 3.88 per cent.
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. -- AP
