Short-Term T-Bill Rates Mixed at Auction

The Treasury Department sold $7.1 billion in three-month bills at an average discount rate of 4.94%, up from 4.93% last week. Another $7.1 billion was sold in six-month bills at an average rate of 5.20%, down from 5.22%. The three-month rate is the highest since the bills sold for 5.03% on May 27. The six-month rate is the lowest since the bills sold for 5.18% on March 10. The new discount rates understate the actual return to investors: 5.07% for three-month bills, with a $10,000 bill selling for $9,875.10, and 5.41% for a six-month bill selling for $9,737.10. In a separate report, the Federal Reserve Board said the average yield for one-year Treasury bills fell to 5.76% last week from 5.86% the previous week. The next auction of 52-week notes will be June 19; two-year notes, June 24; and five-year notes, June 25.