"Money market funds warm to commercial paper again" writes Reuters, which states, "Prime institutional money funds, the sector hardest hit by outflows following the Reserve Primary fund's 'breaking the buck' downturn, saw assets increased overnight by $5 billion on Tuesday and by $19 billion over the past week, according to data released on Wednesday by Crane Data, a money-market research firm in Westborough, Massachusetts." It quotes Peter Crane, "Prime money funds are the largest purchaser of commercial paper, so commercial paper demand depends heavily on these asset flows.... Everybody is watching the flows. If money funds do not fear redemptions, they will return to commercial paper. Investors are gingerly returning back to money market funds, which allows them to expand their commercial paper holdings. If the Fed buys longer-term paper, then companies will be able to refinance and take back their short-term paper if need be." Also, Bloomberg writes "U.S. Commercial Paper Borrowing at Fed Slows as Rates Plunge".
