BANKING & FINANCE - July 21, 1992

Interests Rates Lowest in 29 Years: The Treasury sold $11.7 billion of new six-month bills at an average discount rate of 3.24%, down from 3.31% last week. Another $11.6 billion of three-month bills was sold at an average discount rate of 3.16%, down from 3.22% last week. The six-month bill rate was the lowest since they sold for 3.093% on July 1, 1963. The three-month bill rate was the lowest since they averaged 3.145% on Feb. 18, 1972. The new discount rates understate the actual return to investors--3.34% for six-month bills, with a $10,000 bill selling for $9,836.20, and 3.23% for a three-month bill selling for $9,920.10. The discount rate reflects the price discount received when government securities are purchased at less than face value.