Rates on Treasury bills mixed at weekly auction

[June 14, 2011]  WASHINGTON (AP) -- Interest rates on short-term Treasury bills were mixed in Monday's auction with the rate on three-month bills rising and the rate on six-month bills unchanged.

The Treasury Department auctioned $27 billion in three-month bills at a discount rate of 0.050 percent, up from 0.045 percent last week. Another $24 billion in six-month bills was auctioned at a discount rate of 0.105 percent, unchanged from last week.

The three-month rate was the highest since those bills averaged 0.060 percent two weeks ago on May 31. The 0.105 percent rate that six-month bills have averaged for two weeks was the lowest since these bills averaged 0.100 percent on May 23.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,998.74 while a six-month bill sold for $9,994.69. That would equal an annualized rate of 0.051 percent for the three-month bills and 0.107 percent for the six-month bills.

Separately, the Federal Reserve said Monday that the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, was 0.18 percent, the same as the previous week.

[Associated Press]

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