3-Month T-Bill Rate Highest Since September

The Treasury Department sold $7.51 billion in three-month bills at a discount rate of 4.53%, up from 4.44% last week. An additional $7.51 billion was sold in six-month bills at a rate of 4.43%, down from 4.47%. The three-month rate was the highest since Sept. 21, when the bills sold for 4.64%. The six-month rate was the lowest since Feb. 8, when the rate was 4.42%. The new discount rates understate the actual return to investors--4.65% for three-month bills, with a $10,000 bill selling for $9,885.50, and 4.60% for a six-month bill selling for $9,776.00. An auction of two-year notes is scheduled tentatively for Wednesday. In a separate report, the Federal Reserve said the average yield for one-year Treasury bills, the most popular index for making changes in adjustable-rate mortgages, rose to 4.71% last week from 4.67% the previous week.