Short-Term Treasury Rates Mixed

The Treasury Department sold $7.25 billion in three-month bills at an average discount rate of 5.11%, down from 5.145% last week. An additional $7.29 billion was sold in six-month bills at an average rate of 5.195%, the same as last week. The three-month bills’ rate was the lowest since they sold for 4.97% on Oct. 27. The new discount rates understate the actual return to investors: 5.250% for three-month bills, with a $10,000 bill selling for $9,870.80, and 5.408% for a six-month bill selling for $9,737.40. In a separate report, the Federal Reserve Board said the average yield for one-year Treasury bills rose to 5.50% last week from 5.46% the previous week. The next auction of two-year notes will be Dec. 22; five-year notes will be auctioned Dec. 23.