Treasury Bill Interest Rates Rise

The Treasury Department sold $11.6 billion in three-month bills at an average discount rate of 5.05%, up from 4.97% last week. An additional $12.1 billion was sold in six-month bills at an average rate of 5.09%, up from 5.07%. The rates are the highest since June 30, when three-month bills sold for 5.12% and six-month bills averaged 5.14%. The new discount rates understate the actual return to investors: 5.19% for three-month bills, with a $10,000 bill selling for $9,872.30, and 5.30% for a six-month bill selling for $9,742.70. In a separate report, the Federal Reserve Board said the average yield for one-year Treasury bills fell to 5.54% last week from 5.63% the week before. The next auction of two-year notes will be July 22; five-year notes on July 23.