Rates mixed at weekly Treasury bill auction

AP News
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Posted: Jul 11, 2011 6:19 PM
Rates mixed at weekly Treasury bill auction

Interest rates on short-term Treasury securities were mixed in Monday's auction with rates on three-month bills rising and rates on six-month bills dipping to match a record low.

The Treasury Department auctioned $27 billion in three-month bills at a discount rate of 0.030 percent, up from 0.025 percent last week. Another $24 billion was auctioned in six-month bills at a discount rate of 0.065 percent, down from 0.080 percent last week.

The three-month rate was the highest since those bills averaged 0.035 percent on June 20. The six-month rate matched a record low set on May 9.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,999.24 while a six-month bill sold for $9,996.71. That would equal an annualized rate of 0.031 percent for the three-month bills and 0.066 percent for the six-month bills.

Separately, the Federal Reserve said Monday that the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, was 0.19 percent last week, unchanged from the previous week.