WASHINGTON -- Interest rates on short-term Treasury securities rose in Monday's auction.
The Treasury Department sold $18 billion in three-month bills at a discount rate of 0.985 percent, up from 0.970 percent last week. An additional $15 billion was sold in six-month bills at a rate of 1.175 percent, up from 1.165 percent.
The three-month rate was the highest since June 9, 2003, when the bills sold for 1.005 percent. The six-month rate was the highest since April 21, 2003, when the rate was 1.185 percent.
The new discount rates understate the actual return to investors - 1.001 percent for three-month bills, with a $10,000 bill selling for $9,975.10, and 1.198 percent for a six-month bill selling for $9,940.60.
In a separate report, the Federal Reserve said Monday that the average yield for one-year constant maturity Treasury bills, a popular index for making changes in adjustable rate mortgages, rose to 1.55 percent last week from 1.50 percent the previous week.