Originally created 08/24/04

Rates rise in Treasury bill auction

WASHINGTON -- Interest rates on short-term Treasury securities rose in Monday's auction.

The Treasury Department sold $19 billion in three-month bills at a discount rate of 1.515 percent, up from 1.470 percent last week. An additional $17 billion was sold in six-month bills at a rate of 1.750 percent, up from 1.725 percent.

The three-month rate was the highest since Oct. 28, 2002, when the bills sold for 1.550 percent. The six-month rate was the highest since June 24, 2002, when the rate was 1.765 percent.

The new discount rates understate the actual return to investors - 1.541 percent for three-month bills with a $10,000 bill selling for $9,961.30 and 1.791 percent for a six-month bill selling for $9,911.50.


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