Rates Rise on 3- and 6-Month Treasury Bills

The Treasury Department sold $5.79 billion in three-month bills at an average discount rate of 4.98%, up from 4.96% last week. An additional $7.28 billion was sold in six-month bills at an average rate of 5.03%, up from 5.01%. The rates were the highest since June 29, when three-month bills sold for 5.00% and six-month bills averaged 5.06%. The new discount rates understate the actual return to investors: 5.11% for three-month bills, with a $10,000 bill selling for $9,874.10, and 5.23% for a six-month bill selling for $9,746.00. Separately, the Federal Reserve Board said the average yield for one-year Treasury bills, the most popular index for making changes in adjustable-rate mortgages, fell to 5.34% last week from 5.38% the previous week.