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Rates mixed in weekly US Treasury auction with 3-month bills rising to highest since August

WASHINGTON – Interest rates on short-term Treasury bills were mixed in Monday’s auction, with rates on three-month bills rising to their highest level since August and rates on six-month bills unchanged.

The Treasury Department auctioned $24 billion in three-month bills at a discount rate of 0.025 per cent, up from 0.020 per cent last week. Another $28 billion in six-month bills was auctioned at a discount rate of 0.060 per cent, unchanged from last week.

The three-month rate was the highest since those bills averaged 0.030 per cent on Aug. 25.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,999.37, while a six-month bill sold for $9,996.97. That would equal an annualized rate of 0.025 per cent for the three-month bills and 0.061 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 0.12 per cent last week, up from 0.11 per cent the previous week.