BANKING & FINANCE - June 6, 1995

T-Bill Rates Drop: The Treasury Department sold $14.2 billion of new three-month bills at an average discount rate of 5.48%, down from 5.64% last week. Another $14.2 billion of new six-month bills was sold at an average discount rate of 5.35%, down from 5.61%. The three-month bill rate is the lowest since they sold for 5.44% on Nov. 28. The six-month bill rate is the lowest since they averaged 5.34% on Oct. 17. The new discount rates understate the actual return to investors--5.65% for three-month bills with a $10,000 bill selling for $9,861.50 and 5.59% for a six-month bill selling for $9,729.50. The discount rate reflects the price discount received when government securities are purchased at less than face value.

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T-Bill Auction

June 5

3-month: 5.48%

6-month: 5.35%