BANKING

T-Bill Rates Drop: The Treasury sold $11.6 billion of new six-month bills at an average discount rate of 3.71%, down from 3.74% last week. Another $11.6 billion of new three-month bills sold at an average discount rate of 3.61%, down from 3.64% last week. The six-month bill rate was the lowest since they averaged 3.513% on Feb. 18, 1972. The three-month bill rate was the lowest since they sold for 3.60% on April 13 of this year. The new discount rates understate the actual return to investors--3.70% for three-month bills with a $10,000 bill selling for $9,908.70, and 3.83% for a six-month bill selling for $9,812.40. The discount rate reflects the price discount received when government securities are purchased at less than face value.

T-Bill Auction 6-month: 3.71% 3-month: 3.61%