Rates on Short-Term T-Bills Rise in Auction

The Treasury Department auctioned $15 billion in three-month bills at a discount rate of 4.685%, up from 4.635% last week. An additional $14 billion in six-month bills was auctioned at a discount rate of 4.780%, up from 4.735% last week.

The new discount rates understate the actual return to investors -- 4.807% for three-month bills, with a $10,000 bill selling for $9,881.57, and 4.966% for a $10,000 bill selling for $9,758.34.

In a separate report, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, rose to 4.94% last week from 4.90% the previous week.