Treasury Bill Rates Fall at Auction:
Lowest Level in a Month

AP 24sep2007

WASHINGTON — Interest rates on short-term Treasury bills fell in Monday's auction with the rate on six-month bills dropping to the lowest level in a month.

The Treasury Department auctioned $16 billion in three-month bills at a discount rate of 3.820 percent, down from 4.050 percent last week. Another $13 billion in six-month bills was auctioned at a discount rate of 4.000 percent, down from 4.130 percent last week.

The three-month rate was the lowest since these bills averaged 3.800 percent two weeks ago. The six-month rate was the lowest since 3.950 percent on Aug. 20.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,903.44 while a six-month bill sold for $9,797.78.

Separately, the Federal Reserve said the average yield for one-year Treasury bills — a popular index for making changes in adjustable rate mortgages — fell to 4.11 percent last week from 4.15 percent the previous week.

source: 24sep2007