Rates Fall in Treasury Department Auction

The Treasury Department sold $10 billion in three-month bills at a discount rate of 4.52%, down from 4.7% last week. An additional $9 billion was sold in six-month bills at a rate of 4.42%, down from 4.53%. The new discount rates understate the actual return to investors--4.638% for three-month bills with a $10,000 bill selling for $9,885.70 and 4.585% for a six-month bill selling for $9,776.50. In a separate report, the Federal Reserve said the average yield for one-year constant maturity Treasury bills, the most popular index for making changes in adjustable rate mortgages, stood at 4.47% last week, unchanged from the previous week.