Treasury Bill Rates Decline in Auction

The Treasury Department sold $6.5 billion in three-month bills at a discount rate of 4.66%, down from 4.72% last week. An additional $7.5 billion was sold in six-month bills at a rate of 4.93%, down from 4.95%. The new discount rates understate the actual return to investors--4.79% for three-month bills, with a $10,000 bill selling for $9,882.20, and 5.14% for a six-month bill selling for $9,751.00. 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, fell slightly to 5.28% last week from 5.29% the previous week. The next auction of two-year notes is set for Sept. 29.