Short-Term T-Bill Rates Climb to 4-Year Highs

The Treasury Department auctioned $18 billion in three-month bills at a discount rate of 3.46%, up from 3.4% last week. An additional $16 billion in six-month bills was auctioned at a discount rate of 3.68%, up from 3.6%.

The three-month rate was the highest since 3.48% on July 30, 2001, and the six-month rate was the highest since 3.86% on April 30, 2001.

The new discount rates understate the actual return to investors: 3.539% for three-month bills, with a $10,000 bill selling for $9,912.54, and 3.802% for a six-month bill selling for $9,813.96.

The Federal Reserve said the average yield for one-year Treasury bills rose to 3.84% last week from 3.77% the previous week.