Rates Rise on 3-, 6-Month T-Bills

Interest rates on short-term Treasury securities rose in auction. The Treasury Department sold $14 billion in three-month bills at a discount rate of 1.67%, up from 1.53% last week.

An additional $13 billion in six-month bills was sold at a rate of 1.735%, up from 1.58%.

The three-month rate was the highest since Dec. 31 when the bills sold for 1.71%. The six-month rate was the highest since Jan. 7 when it was 1.70%.

The new discount rates understate the actual return to investors--1.7% for three-month bills with a $10,000 bill selling for $9,957.80 and 1.774% for a six-month bill selling for $9,912.30.

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, fell to 2.03% last week from 2.13% the previous week.