Short-Term Rates Rise at Treasury Auction

The Treasury Department auctioned $20 billion in three-month bills at a discount rate of 4.375%, up from 4.29% last week. An additional $17 billion in six-month bills was auctioned at a discount rate of 4.435%, up from 4.34% last week.

The new rates understate the actual return to investors -- 4.48% for a three-month bill and 4.60% for a six-month bill.

Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, rose to 4.50% last week from 4.43% the previous week.