Rates Mixed on Short-Term Treasuries

The Treasury Department sold $11.6 billion in three-month bills at an average discount rate of 5.03%, down from 5.04% last week. Another $11.5 billion was sold in six-month bills at an average rate of 5.11%, unchanged from last week. The three-month bill rate was the lowest since they sold for 5.02% on Jan. 6. The six-month bill rate was the highest since they averaged 5.15% on Oct. 28. The new discount rates understate the actual return to investors: 5.16% for three-month bills, with a $10,000 bill selling for $9,872.90, and 5.32% for a six-month bill selling for $9,741.70. In a separate report, the Federal Reserve Board said the average yield for one-year Treasury bills was unchanged last week from 5.61% the previous week. The weekly auction was pushed back to Tuesday because federal government offices were closed Monday in observance of Martin Luther King Jr.’s birthday. Today, the government will auction two-year notes, and on Thursday it will auction five-year notes.