Short-Term Rates Rise in Treasury Auction

The Treasury Department sold $17 billion in three-month bills at a discount rate of 1.355%, up from 1.315% last week. It sold an additional $15 billion in six-month bills at 1.725%, up from 1.675%.

The new rates understate the actual return to investors -- 1.381% for three-month bills, with a $10,000 bill selling for $9,965.70, and 1.764% for a six-month bill selling for $9,912.80.

In a separate report, the Federal Reserve said the average yield for one-year constant maturity Treasury bills, a popular index for making changes in adjustable-rate mortgages, declined to 2.16% last week from 2.22% the previous week.