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Six-month T-bills at a two-week high

Associated Press / February 8, 2011

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WASHINGTON — Interest rates on short-term Treasury bills were mixed in yesterday’s auction, with rates on three-month bills unchanged while six-month bills rose to the highest level in two weeks.

The Treasury Department auctioned $32 billion in three-month bills at a discount rate of 0.150 percent, unchanged from last week. Another $30 billion in six-month bills was auctioned at a discount rate of 0.175 percent, up from 0.170 percent.

The three-month rate matched last week’s level, and both rates were the lowest since Dec. 20, when the three-month bill averaged 0.130 percent. The six-month rate was the highest since these bills averaged 0.180 percent on Jan. 24.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,996.21; a six-month bill sold for $9,991.15. That’s an annualized rate of 0.152 percent for the three-month bills and 0.178 percent for six-month bills.

Separately, the Federal Reserve said the average yield for one-year Treasury bills rose to 0.28 percent last week from 0.26 percent the previous week.