Fed to accept commercial paper for funds

The Federal Reserve on Tuesday adopted a new strategy to placate financial market tensions, saying that it would swap funds for unsecured commercial paper direct from the issuer.

The Fed said it would "provide a liquidity backstop to US issuers of commercial paper" by buying three month unsecured and asset-backed commercial paper directly from eligible issuers.

The Fed will purchase the assets indirectly through the creation of a Commercial Paper Funding Facility, a special purpose vehicle, which

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