Fed Releases US Commercial Paper Data

Summary

In the week ending January 14, U.S. seasonally adjusted commercial paper outstanding fell by $1.5 billion. However, the non-seasonally adjusted figure, which some analysts view as more reliable, surged by $44.6 billion to $1.412 trillion. This included an $18.5 billion increase in foreign financial commercial paper.Reuters

Impact Analysis

The headline seasonally adjusted dip is just noise. The real story is the massive $44.6 billion jump in non-seasonally adjusted commercial paper issuance.Reuters This isn’t a sign of a cooling economy; it’s the opposite. Companies are actively tapping short-term credit markets, pointing to robust operational demand and economic momentum.

This fits perfectly with the other recent data—the strong December jobs report that made traders scrap January rate cut betsSina Finance and the sticky CPI print.AnueSec The market keeps searching for a reason for the Fed to cut, but real economy data, including this funding market signal, tells a different story. The economy is still running hot.

Bottom line, this reinforces the ‘higher for longer’ view. The Fed has no reason to rush. The trade here is to stay short front-end duration. The 2-year yield already spiked after the jobs reportSina Finance, and this just adds more fuel to that fire.