Short-Term Treasury Rates Mixed

The Treasury Department sold $10.8 billion in three-month bills at an average discount rate of 4.93%, the same as last week. An additional $10.7 billion was sold in six-month bills at an average rate of 5.01%, down from 5.08%. The six-month bills’ rate was the lowest since averaging 4.99% on Dec. 16. The new discount rates understate the actual return to investors: 5.06% for three-month bills, with a $10,000 bill selling for $9,875.40, and 5.21% for a six-month bill selling for $9,746.70. In a separate report, the Federal Reserve Board said the average yield for one-year Treasury bills fell to 5.45% last week from 5.47% the previous week. The Treasury will reopen the July 15 auction of 4 3/4-year inflation-indexed notes on Wednesday. The next auction of two-year notes will be Oct. 28 and five-year notes will be Oct. 29.