Short-term T-bill yields are mixed in auction

The Treasury Department auctioned $18 billion in three-month bills at a discount rate of 4.8%, down from 4.87% last week. An additional $16 billion in six-month bills was auctioned at a discount rate of 4.865%, up from 4.84% last week.

The new discount rates understate the actual return to investors -- 4.926% for the three-month bills, with a $10,000 bill selling for $9,878.67, and 5.057% for a six-month bill selling for $9,754.05.

Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, fell to 4.9% last week from 4.95% the previous week.