Treasury Bill Rates Fall in Auction

The Treasury Department sold $8 billion in three-month bills at a discount rate of 4.40%, down from 4.47% last week. Another $8 billion was sold in six-month bills at a rate of 4.43%, down from 4.50%. The three-month rate is the lowest since Oct. 26, when the bills sold for 4.07%. The six-month rate is the lowest since Nov. 2, when the rate was 4.36%. The new discount rates understate the actual return to investors: 4.51% for three-month bills, with a $10,000 bill selling for $9,888.80, and 4.95% for a six-month bill selling for $9,776. Upcoming auctions are tentatively scheduled for Nov. 24 for two-year notes and Feb. 9 for five-year notes. Separately, the Federal Reserve Board reported that the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, rose to 4.52% last week from 4.46% the week before.