The Treasury sold $7.2 billion of new...

The Treasury sold $7.2 billion of new three-month bills at an average discount rate of 7.82%, up from 7.54% last week. Another $7.2 billion of new six-month bills was sold at an average discount rate of 7.87%, up from 7.71% last week. The rates were the highest since three-month bills sold for 7.87% on April 29, 1985, and six-month bills averaged 7.90% on May 13, 1985. The new discount rates understate the actual return to investors--8.09% for three-month bills, with a $10,000 bill selling for $9,802.30, and 8.31% for six-month bills selling for $9,602.10. The discount rate reflects the price discount received when government securities are purchased at less than face value.