Treasury Bill Rates Decline Again

The stock market’s weakness, and growing expectations of interest rate cuts in 2001, continue to push short-term Treasury bill rates lower as more investors jump into the securities. The Treasury sold $12 billion in three-month bills at a discount rate of 5.96%, down from 6.16% last week. An additional $10 billion was sold in six-month bills at a rate of 5.84%, down from 6.045%. The discount rates understate the actual return to investors--6.14% for the three-month bills and 6.1% for the six-month bill. In a separate report, the Federal Reserve said that the average yield for one-year Treasury bills, the most popular index for adjustable-rate mortgages, fell to 6% last week from 6.09% the previous week.