short-term debt instruments

Short-term debt instruments are financial tools used by companies or governments to borrow money for a brief period, typically up to one year. They help meet immediate funding needs, like paying bills or managing cash flow. Examples include Treasury bills, commercial paper, and certificates of deposit. These instruments are usually low-risk and highly liquid, meaning they can be quickly converted into cash. Investors buy them for safety and steady returns, making them popular for short-term investing or managing liquidity. They are an essential part of the financial system for maintaining efficient cash flow and funding short-term obligations.