6-month T bills at lowest in a month

Associated Press / November 10, 2009

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WASHINGTON - Interest rates on short-term Treasury bills were mixed in yesterday’s auction. Rates on three-month bills rose, and rates on six-month bills fell to the lowest level in a month.

The Treasury Department auctioned $30 billion in three-month bills at a discount rate of 0.065 percent, up from 0.060 percent last week. Another $31 billion in six-month bills was auctioned at a discount rate of 0.165 percent, down from 0.170 percent last week.

The three-month rate was the highest since those bills averaged 0.075 percent on Oct. 26. The six-month rate was the lowest since those bills averaged 0.150 percent on Oct. 13.

Fed officials wrapped up two days of discussion last week with an announcement that they planned to keep rates at exceptionally low levels for an extended period to provide more support for the wobbly economy.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,998.36, while a six-month bill sold for $9,991.66. That would equal an annualized rate of 0.066 percent for three-month bills, and 0.167 percent for six-month bills.

Separately, the Federal Reserve said the average yield for one-year Treasury bills fell to 0.36 percent last week, from 0.39 percent the previous week.