Rates mixed in T-bill sale

WASHINGTON -- Interest rates on short-term Treasury bills were mixed in yesterday's auction, with rates on six-month bills rising and rates on three-month bills dropping to the lowest level since early June.

The Treasury Department auctioned $16 billion in three-month bills at a discount rate of 4.765 percent, down from 4.770 percent last week. Some $15 billion in six-month bills was auctioned at a discount rate of 4.825 percent, up from 4.810 percent last week.

The three-month rate was the lowest since these bills averaged 4.710 percent on June 5. The six-month rate was the highest since these bills brought 4.920 percent on Sept. 18.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,879.55 while a six-month bill sold for $9,756.07.

Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, fell to 4.90 percent last week from 4.97 percent the previous week.