3-Month, 6-Month Treasury Bill Rates Up

The Treasury Department sold $9.5 billion in three-month bills at a discount rate of 6.110%, up from 6.090% last week. An additional $8.5 billion was sold in six-month bills at a rate of 6.090%, up from 6.075%. The three-month rate was the highest since Jan. 28, 1991, when the bills sold for 6.22%. The six-month rate was the highest since July 31, when the rate was 6.115%. The new discount rates understate the actual return to investors--6.291% for three-month bills with a $10,000 bill selling for $9,843.90 and 6.371% for a six-month bill selling for $9,692.10. An auction of two-year notes is scheduled tentatively for Wednesday. In a separate report, 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 6.21% last week from 6.17% the previous week.