3-Month Treasury Bill Rate Declines Slightly

The Treasury Department auctioned $18 billion in three-month bills at a discount rate of 3.9%, down from 3.94% last week. An additional $16 billion in six-month bills was auctioned at a discount rate of 4.155%, unchanged from last week.

The discount rates understate the actual return to investors -- 3.994% for three-month bills, with a $10,000 bill selling for $9,901.42, and 4.303% for a six-month bill selling for $9,789.94.

Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, fell to 4.3% last week from 4.36% the previous week.