Rates mixed at weekly Treasury auction

[March 20, 2012]  WASHINGTON (AP) -- Interest rates on short-term Treasury bills were mixed in Monday's auction with rates on three-month bills unchanged and rates on six-month bills rising to their highest level in a year.

The Treasury Department auctioned $33 billion in three-month bills at a discount rate of 0.095 percent, unchanged from last week. Another $31 billion in six-month bills was auctioned at a discount rate of 0.150 percent, up from 0.145 percent last week.

The 0.095 percent rate for three-month bills for the past two weeks represents the highest level since those bills averaged 0.115 percent on Feb. 27. The 0.150 percent for six-month bills is the highest since March 28, 2011, when those bills averaged 0.170 percent.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,997.60 while a six-month bill sold for $9,992.42. That would equal an annualized rate of 0.096 percent for the three-month bills and 0.152 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, rose to 0.20 percent last week from 0.18 percent the previous week.

[Associated Press]

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