Interest Rates on T-Bills Rise

The Treasury Department sold $5.76 billion in three-month bills at an average discount rate of 4.990%, up from 4.940% last week. An additional $7.3 billion was sold in six-month bills at an average rate of 5.110%, down from 5.115%. The three-month rate was the highest since April 13, when the bills sold for 5.035%. The six-month rate was the lowest since 5.060% on April 20. The new discount rates understate the actual return to investors--5.122% for three-month bills, with a $10,000 bill selling for $9,873.90, and 5.318% for a six-month bill selling for $9,741.70. In a separate report, the Federal Reserve Board said the average yield for one-year Treasury bills rose to 5.45% last week from 5.40% the previous week.