Interest rates on six-month Treasury bills dipped to an all-time low at Monday's weekly Treasury auction while rates on three-month bills were unchanged at the lowest level since the 2008 financial crisis.
The Treasury Department auctioned $29 billion in three-month bills at a discount rate of 0.010 percent, unchanged from last week. Another $27 billion was auctioned in six-month bills at a discount rate of 0.030 percent, down from 0.050 percent last week.The three-month rate for the past two weeks has been at the lowest level since these bills averaged 0.005 percent on Dec. 8, 2008, during the U.S. financial crisis, when investors were seeking the safety of U.S. Treasury debt. The six-month rate was the lowest level on record.
The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,999.75, while a six-month bill sold for $9,998.48. That would equal an annualized rate of 0.010 percent for the three-month bills and 0.031 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, edged down to 0.10 percent last week from 0.12 percent the previous week.