3-Month Treasury Bills Fall to 5-Week Low

The Treasury Department auctioned $8.5 billion in three-month bills at a discount rate of 5.730%. An additional $7.5 billion in six-month bills was auctioned at a discount rate of 6.150%. The three-month rate was down from 5.810% last week and was the lowest since three-month bills averaged 5.620% on April 24. The six-month rate was up from 6.125% last week and was the highest since 6.250% on May 15. The next auction of two-year notes is scheduled tentatively for June 28. The new discount rates understate the actual return to investors--5.893% for three-month bills, with a $10,000 bill selling for $9,855.20, and 6.435% for a six-month bill selling for $9,689.10.