Treasury Bill Rates Climb at Auction

The Treasury Department sold $7.51 billion in three-month bills at a discount rate of 4.570%, up from 4.530% last week. An additional $7.5 billion was sold in six-month bills at a rate of 4.585%, up from 4.430%. The rates were the highest since Sept. 21, when three-month bills sold for 4.635% and the six-month rate was 4.615%. The new discount rates understate the actual return to investors--4.700% for three-month bills, with a $10,000 bill selling for $9,884.50, and 4.772% for a six-month bill selling for $9,768.20. An auction for two-year notes is tentatively scheduled for March 24. Separately, the Federal Reserve said that the average yield for one-year Treasury bills, the most popular index for making changes in adjustable-rate mortgages, rose to 4.82% last week from 4.71% the week before.