BANKING & FINANCE - Oct. 17, 1995

Interest Rates on Short-Term T-Bills Rise: Rates on short-term Treasury securities rose at auction to the highest level in two weeks. The Treasury Department sold $13 billion in three-month bills at an average discount rate of 5.32%, up from 5.31% last week. Another $13 billion in six-month bills was sold at an average discount rate of 5.34%, up from 5.32%. The three-month bill rate was the highest since they sold for 5.34% on Oct. 2. The six-month bill rate was the highest since they averaged 5.38% the same day. The new discount rates understate the actual return to investor: 5.48% for three-month bills, with a $10,000 bill selling for $9,865.50, and 5.58% for a six-month bill selling for $9,730.