The primary sellers of corporate bonds during the quarter were issuers of asset-backed securities, placing a record (net) $315.2 billion.

The principal buyers were foreign investors ($213.2 billion, net) and life insurance companies ($160.1 billion net). Also major sellers in this market were domestic households ($181.4 billion, net).

Money raised by issuers of asset-backed securities was used mainly to finance home mortgages ($255.7 billion, net) and commercial mortgages ($64.6 billion, net).

Since bond prices were falling during the quarter, it appears that the pressure upon issuers of asset-backed securities to fill demand for home mortgages caused corporate bond rates to rise over the quarter.

Sale of corporate bonds by domestic households was consistent with a long-term tendency of individuals to divest this type of asset.

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