Treasury Bill Rates Decline at Auction

The Treasury Department sold $8 billion in three-month bills at a discount rate of 4.43%, down from 4.45% last week. An additional $8 billion was sold in six-month bills at a rate of 4.41%, down from 4.43%. The three-month rate is the lowest since Nov. 16, when the bills sold for 4.40%. The six-month rate is the lowest since Nov. 2, when the rate was 4.36%. The new discount rates understate the actual return to investors--4.55% for three-month bills, with a $10,000 bill selling for $9,887.90, and 4.57% for a six-month bill selling for $9,777.10. The department also sold 14-day cash-management bills at a discount rate of 4.86%. The discount rate understates the actual return to investors--4.94%, with a $10,000 bill selling for $9,981.10. A total of $23 billion in bills was sold, out of bids totaling $42.9 billion. The next auction of two-year notes will be Dec 29; five-year notes on Feb. 9; 10-year notes on Feb. 10; and 30-year bonds on Feb. 11. In a separate report, the Federal Reserve said that the average yield for one-year Treasury bills rose to 4.59% last week from 4.54% the week before.