3-Month T-Bills at Lowest Rate Since January

The Treasury Department sold $6.5 billion in three-month bills at a discount rate of 4.375%, down from 4.47% last week and the lowest rate since Jan. 25. An additional $7.51 billion was sold in six-month bills at a rate of 4.42%, down from 4.53% and the lowest rate since Feb. 1. The new discount rates understate the actual return to investors--4.498% for three-month bills, with a $10,000 bill selling for $9,889.40, and 4.597% for a six-month bill selling for $9,776.50. In a separate report, the Federal Reserve said that the average yield for one-year Treasury bills, the most popular index for making changes in adjustable-rate mortgages, fell to 4.74% last week from 4.77% the previous week.