BANKING & FINANCE - Aug. 11, 1992

Treasury Bill Rates Fall: Interest rates on short-term Treasury securities fell in Monday’s auction, with rates on six-month bills dropping to their lowest level in 29 years. The Treasury Department sold $11.68 billion in three-month bills at an average discount rate of 3.13%, down from 3.20% last week. An additional $11.63 billion in six-month bills was sold at an average discount rate of 3.19%, down from 3.30% last week. The three-month bill rate was the lowest since they sold for 3.07% on Feb. 14, 1972. The six-month bill rate was the lowest since they averaged 3.09% on July 1, 1963. The new discount rates understate the actual return to investors--3.20% for three-month bills, with a $10,000 bill selling for $9,920.90, and 3.29% for a six-month bill selling for $9,838.70.

T-Bill Auction 6-month: 3.19% 3-month: 3.13%