Rates on US Treasury bills fall at weekly auction

WASHINGTON – Interest rates on short-term Treasury bills fell in Monday’s auction with rates on six-month bills dipping to their lowest point since November.

The Treasury Department auctioned $31 billion in three-month bills at a discount rate of 0.260 per cent, down from 0.270 per cent last week. Another $26 billion in six-month bills was auctioned at a discount rate of 0.340 per cent, down from 0.400 per cent last week.

The three-month rate was the lowest since three-month bills averaged 0.240 per cent on May 9. The six-month rate was the lowest since those bills averaged 0.330 per cent last Nov. 16.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,993.43, while a six-month bill sold for $9,982.81. That would equal an annualized rate of 0.264 per cent for the three-month bills and 0.345 per cent for the six-month bills.

Separately, the Federal Reserve said Monday that the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, edged up to 0.55 per cent last week from 0.53 per cent the previous week.