WASHINGTON — Interest rates on short-term Treasury bills rose in yesterday’s auction for the second straight week.
The Treasury Department auctioned $27 billion in three-month bills at a discount rate of 0.055 percent, up from 0.030 percent last week. Another $24 billion was auctioned in six-month bills at a discount rate of 0.1 percent, up from 0.070 percent.
The government has hit its current borrowing limit of $14.3 trillion. Last week Treasury Secretary Timothy Geithner told Congress in a letter that he will remove investments from two government employee pension funds to clear room to continue with regular debt auctions.
The three-month rate was the highest since three-month bills averaged 0.065 percent on April 25. The six-month rate was the highest since these bills averaged 0.115 percent, also on April 25.
The discount rates indicate that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,998.61 while a six-month bill sold for $9,994.92.
Separately the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, rose to 0.19 percent last week from 0.18 percent.