WASHINGTON – Interest rates on short-term Treasury bills fell in Monday’s auction with rates on three-month bills falling to the lowest level in five weeks.
The Treasury Department auctioned $31 billion in three-month bills at a discount rate of 0.270 per cent, down from 0.285 per cent last week. Another $26 billion in six-month bills was auctioned at a discount rate of 0.400 per cent, down from 0.430 per cent last week.
The three-month rate was the lowest since three-month bills averaged 0.240 per cent five weeks ago on May 9. The six-month rate was the lowest since those bills averaged 0.370 per cent on May 16.
The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,993.18, while a six-month bill sold for $9,979.78. That would equal an annualized rate of 0.274 per cent for the three-month bills and 0.406 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, fell to 0.59 per cent last week from 0.67 per cent the previous week.