As reported in the current issue of ASR (5/12/03), the Federal Reserve recorded a significant spike in ABCP outstandings in late April — to the tune of $30 billion over one week — all of which puzzled market players who said they really hadn’t witnessed this sort of increase in activity.  

As it turns out, the Fed's numbers were misleading because, during the week-over-week period, nearly the entire statistical increase was attributable to the addition of pre-existing programs to the source pool.

In its outstandings page, the Fed footnotes the following: “Asset-backed commercial paper outstanding level as of the week ending April 30, 2003 includes $28 billion of existing but previously unrecorded programs.”

What’s not clear is how long these programs have existed and if the spike associated with their inclusion is meaningful in gauging market volume trends. The Federal Reserve receives its CP data from the Depository Trust Company (DTC).

More on this in next week’s issue…

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