Short-Term T-Bill Rates Fall at Auction

The Treasury Department sold $14 billion in three-month bills at a discount rate of 1.195%, down from 1.21% last week. An additional $15 billion in six-month bills was sold at 1.245%, down from 1.29%.

The new rates understate the actual return to investors -- 1.215% for three-month bills, with a $10,000 bill selling for $9,969.80, and 1.269% for a six-month bill selling for $9,937.10.

In a separate report, the Federal Reserve said the average yield for one-year, constant-maturity Treasury bills, the most popular index for making changes in adjustable-rate mortgages, dipped to 1.53% last week from 1.55% the previous week.