3-Month, 6-Month Treasury Bill Rates Rise

The Treasury Department sold $7.5 billion in three-month bills at a discount rate of 5.35%, up from 5.235% last week. An additional $6.5 billion was sold in six-month bills at a rate of 5.535%, up from 5.420%. The new discount rates understate the actual return to investors--5.512% for three-month bills, with a $10,000 bill selling for $9,864.80, and 5.789% for a six-month bill selling for $9,720.20. Upcoming auctions are tentatively scheduled on Wednesday for two-year notes, Feb. 8 for five-year notes and Feb. 9 for 10-year notes. 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 6.12% last week from 6.03% the previous week.