3-Month T-Bill Rate at 10-Month Low

The Treasury Department sold $13 billion in three-month bills at an average discount rate of 4.83%, down from 4.98% last week, to the lowest level since February. An additional $13.1 billion was sold in six-month bills at an average rate of 4.97%, down from 5.04%. The three-month bill rate is the lowest since they sold for 4.78% on Feb. 20. The six-month bill rate is the lowest since it averaged 4.80% on March 4. The new discount rates understate the actual return to investors: 4.96% for three-month bills, with a $10,000 bill selling for $9,877.90, and 5.17% for a six-month bill selling for $9,748.70. In a separate report, the Federal Reserve Board said the average yield for one-year Treasury bills, the most popular index for making changes in adjustable-rate mortgages, rose to 5.42% last week from 5.41% the previous week. The next auction of two-year notes will be Dec. 18, of five-year notes, Dec. 19.