Interest Rates Mixed in Treasury Auction

The Treasury Department sold $17 billion in three-month bills at a discount rate of 0.94%, unchanged from last week. An additional $17 billion was sold in six-month bills at a rate of 1.025%, up from 1.02% the previous week.

The new discount rates understate the actual return to investors -- 0.96% for three-month bills, with a $10,000 bill selling for $9,976.20, and 1.047% for a six-month bill selling for $9,948.20.

In a separate report, the Federal Reserve said the average yield for one-year constant-maturity Treasury bills, the most popular index for making changes in adjustable-rate mortgages, was 1.3% last week, unchanged from the previous week.