WASHINGTON – Interest rates on short-term Treasury bills fell in Monday’s auction with rates on three-month bills dropping to their lowest level in three weeks.
The Treasury Department auctioned $35 billion in three-month bills at a discount rate of 0.035 per cent, down from 0.130 per cent last week. Another $30 billion in six-month bills was auctioned at a discount rate of 0.070 per cent, down from 0.150 per cent last week.
The three-month rate was the lowest since three-month bills averaged 0.010 per cent on Sept. 30. The six-month rate was the lowest since those bills averaged 0.060 per cent on Oct. 7.
The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,999.120 while a six-month bill sold for $9,996.46. That would equal an annualized rate of 0.035 per cent for the three-month bills and 0.071 per cent 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 0.14 per cent last week, unchanged from the previous week.