BANKING & FINANCE - Dec. 31, 1991

Treasury Bill Rates Rise: Interest rates on short-term Treasury securities rose to their highest level in two weeks. The Treasury Department sold $10.2 billion in three-month bills at an average discount rate of 3.91%, up from 3.75% last week. Another $10.2 billion in six-month bills was sold at the same average discount rate, up from 3.85% last week. The rates were the highest since Dec. 16, when three-month bills sold for 4.14% and six-month bills averaged 4.19%. The new discount rates understate the actual return to investors--4.01% for three-month bills, with a $10,000 bill selling for $9,901.20 and 4.06% for a six-month bill selling for $9,802.30. In a separate report, the Federal Reserve said the average yield for one-year Treasury bills, the most popular index for making changes in adjustable rate mortgages, fell to 4.17% last week, down from 4.35% the previous week.

T-Bill Auction 6-month: 3.91% 3-month: 3.91%