T-Bill Rates Rise: The Treasury sold $7.7...

T-Bill Rates Rise: The Treasury sold $7.7 billion of new three-month bills at an average discount rate of 7.77%, up from 7.66% last week. Another $7.6 billion of new six-month bills was sold average discount rate of 7.73%, up from 7.58% last week. The rates were the highest since three-month bills sold for 7.78% on Oct. 30, 1989, and six-month bills averaged 7.92% on Oct. 2, 1989. Three-month bills also sold for 7.77% on Dec. 26, 1989. The new discount rates understate the actual return to investors--8.04% for three-month bills, with a $10,000 bill selling for $9,803.60, and 8.16% for a six-month bill selling for $9,609.20. The discount rate reflects the price discount received when government securities are purchased at less than face value.