Short-Term Treasury Bill Rates Mixed

The Treasury Department sold $5.75 billion in three-month bills at an average discount rate of 4.92%, up from 4.91% last week. An additional $7.25 billion was sold in six-month bills at an average rate of 4.94%, down from 4.95%. The three-month rate was the highest since Aug. 10, when the bills sold for 4.94%. The six-month rate was the lowest since Jan. 12, when the average was 4.91%. The new discount rates understate the actual return to investors--5.05% for three-month bills with a $10,000 bill selling for $9,874.30 and 5.14% for a six-month bill selling for $9,750.30. The next scheduled auction of two-year notes will be on Wednesday. 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 5.24% last week from 5.23% the previous week.