Rates Dip on Short-Term Treasury Bills

The Treasury Department sold $9.5 billion in three-month bills at a discount rate of 5.945%, down from 6.065% last week. An additional $8.5 billion was sold in six-month bills at a rate of 5.955%, down from 6.03%. The new discount rates understate the actual return to investors--6.121% for three-month bills with a $10,000 bill selling for $9,849.70 and 6.226% for a six-month bill selling for $9,698.90. In a separate report, the Federal Reserve said that the average yield for one-year Treasury bills, the most popular index for making changes in adjustable rate mortgages, fell to 6.2% last week from 6.23% the previous week.