Short-Term T-Bill Rates Drop: The Treasury Department...

Short-Term T-Bill Rates Drop: The Treasury Department sold $10 billion of new three-month bills at an average discount rate of 6.12%, down from 6.52% last week. Another $10 billion of new six-month bills was sold at an average discount rate of 6.21%, down from 6.51% last week. The rates were the lowest since three-month bills sold for 5.92% on April 25, 1988, and six-month bills averaged 6.14% on April 19, 1988. The new discount rates understate the actual return to investors--6.30% for three-month bills, with a $10,000 bill selling for $9,845.30, and 6.50% for a six-month bill selling for $9,686.10. The discount rate reflects the price discount received when the securities are purchased at less than face value.

T-Bill Auction 3-month: 6.12% 6-month: 6.21%