Rates on Treasury Bills Rise at Auction

The Treasury Department sold $9.5 billion in three-month bills at a discount rate of 6.005%, up from 5.960% last week. An additional $8.5 billion was sold in six-month bills at a rate of 5.985%, up from 5.935%. The rates were the highest since Sept. 5, when the three-month bills sold for 6.056% and the six-month for 6.030%. The new discount rates understate the actual return to investors--6.183% for three-month bills with a $10,000 bill selling for $9,848.20 and 6.258% for a six-month bill selling for $9,697.40. The next auction of two-year notes is Wednesday. In a separate report, the Federal Reserve said the average yield for one-year Treasury bills fell to 6.09% last week from 6.14% the previous week.