BANKING & FINANCE - June 7, 1994

Rates Fall on Short-Term Treasury Bills: The Treasury Department sold $12.7 billion in new three-month bills at an average discount rate of 4.15%, down from 4.23% last week. Another $12.6 billion of new six-month bills was sold at an average discount rate of 4.53%, down from 4.67%. The new discount rates understate the actual return to investors: 4.25% for three-month bills, with a $10,000 bill selling for $9,895.10, and 4.7% for a six-month bill selling for $9,777.10. The discount rate reflects the price discount received when government securities are sold at less than face value.

T-Bill Auction

3-month: 4.15%

6-month: 4.53%