Short-Term T-Bill Rates Rise

Interest rates on short-term Treasury securities rose in auction to the highest level since late September. The Treasury Department sold $14.2 billion in three-month bills at an average discount rate of 5.04%, up from 5.01% last week. An additional $14 billion was sold in six-month bills at an average rate of 5.15%, up from 5.12%. The three-month bill rate was the highest since they sold for 5.18% on Sept. 23. The six-month bill rate was the highest since they averaged 5.17% on Sept. 30. The discount rates understate the actual return to investors--5.18% for three-month bills, with a $10,000 bill selling for $9,872.60, and 5.36% for a six-month bill selling for $9,739.60. Separately, the Federal Reserve Board said the average yield for one-year Treasury bills rose to 5.56% last week from 5.55% the previous week.