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Short-term T-bill rates rise

WASHINGTON -- Interest rates on short-term Treasury bills rose in yesterday's auction to the highest levels since the spring of 2001.

The Treasury Department auctioned $18 billion in three-month bills at a discount rate of 3.910 percent, up from 3.870 last week. Another $16 billion in six-month bills was auctioned at a discount rate of 4.195 percent, up from 4.155 percent last week.

The three-month bill rate was the highest since they averaged 4.050 percent on April 16, 2001. The six-month rate was the highest since 4.220 percent on March 19, 2001.

The discount rates reflect that the bills sell for less than face value. For a $10,000 security, the price set in yesterday's auction was $9,901.16 for a three-month bill and $9,787.92 for a six-month bill.

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 4.35 percent last week from 4.32 percent the previous week.

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