US Treasury bill rates fall at weekly auction with 3-month bills down to lowest since October

WASHINGTON – Interest rates on short-term Treasury bills fell in Monday’s auction with rates on three-month bills dropping to the lowest level since October.

The Treasury Department auctioned $26 billion in three-month bills at a discount rate of 0.015 per cent, down from 0.020 per cent last week. Another $26 billion in six-month bills was auctioned at a discount rate of 0.065 per cent, down from 0.075 per cent last week.

The three-month rate was the lowest since three-month bills averaged 0.010 per cent on Oct. 14. The six-month rate was the lowest since these bills averaged 0.060 per cent on Nov. 10.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,999.62 while a six-month bill sold for $9,996.71. That would equal an annualized rate of 0.015 per cent for the three-month bills and 0.066 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 0.17 per cent last week, unchanged from the previous week.