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Rates fall on US Treasury bills at weekly auction to lowest levels in 3 weeks

WASHINGTON – Interest rates on short-term Treasury bills fell in Monday’s auction to their lowest levels in three weeks.

The Treasury Department auctioned $20 billion in three-month bills at a discount rate of 0.055 per cent, down from 0.075 per cent last week. Another $20 billion in six-month bills was auctioned at a discount rate of 0.260 per cent, down from 0.275 per cent last week.

The three-month rate was the lowest since three-month bills averaged 0.050 per cent on Aug. 24. The six-month rate was the lowest since those bills averaged 0.200 per cent, also on Aug. 24.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,998.61, while a six-month bill sold for $9,986.86. That would equal an annualized rate of 0.56 per cent for the three-month bills and 0.265 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, edged up to 0.39 per cent last week from 0.37 per cent the previous week.