Rates on Treasury bills fall at weekly auction

Rates on Treasury bills fall at weekly auction with 6-month bills hitting more than 1-year low

Associated Press

WASHINGTON (AP) -- Interest rates on short-term Treasury bills fell in Monday's auction, with rates on six-month bills dropping to their lowest point in more than a year.

The Treasury Department auctioned $32 billion in three-month bills at a discount rate of 0.050 percent, down from 0.055 percent last week. Another $28 billion in six-month bills was auctioned at a discount rate of 0.085 percent, down from 0.090 percent last week.

The three-month rate was the lowest since three-month bills averaged 0.040 percent on Dec. 17. The six-month rate was the lowest since those bills averaged 0.075 percent on Jan. 30, 2012.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,998.73 while a six-month bill sold for $9,995.70. That would equal an annualized rate of 0.051 percent for the three-month bills and 0.086 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 0.11 percent last week from 0.12 percent the previous week.

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