The Federal Reserve on Thursday said that commercial banks increased their borrowings from Fed’s emergency lending program over past week. They borrowed in average $41.9 billion daily over the week that ended Wednesday, comparing to $38.2 billion in the week ending May 27. At the same time investment firms didn't borrowed over the past week from the Fed program. Last time they drew a loan was in the week that ended May 13. The total amount of loans was just $482 million. Both types of financial institutions pay just 0.5% in interest for the emergency loans.

Also Fed’s report showed that the Fed’s average net holdings of commercial papers decreased by $9.6 billion, coming to $145.1 billion over the week that ended Wednesday. Fed began buying them on Oct. 27, a time of intensified credit problems.

According to that report, the Fed detruncated its purchases of mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae. They were shortened by $3.3 billion, arriving to average amount of $427.6 billion over the past week. This program of the Fed was goaled to help housing market by driving down mortgage rates. It started January 5. First after Fed’s declaration about this program mortgage rates have dropped. But rates have been rising in recent weeks. As Freddie Mac reported Thursday rates on 30-year home loans jumped to the highest weekly average in nearly six months – from 4.91% last week to 5.29% this week.

In order to pull down rates on mortgages and other consumer debt the Fed in March declared about its intension to purchase up to $300 billion worth of Treasury securities over the next 6 months.

The report also said that the credit provided to AIG slightly decreased last week, averaging to $43.6 billion.