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Us - Interest Rates Rise In Treasury Auction

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WASHINGTON — Interest rates on short-term Treasury bills rose in Tuesday's auction to the highest levels in five years.

The Treasury Department auctioned $20 billion in three-month bills at a discount rate of 4.450 percent, up from 4.440 percent last week. Another $18 billion in six-month bills was auctioned at a discount rate of 4.545 percent, up from 4.540 percent last week.

The three-month rate was the highest since these bills averaged 4.520 percent March 12, 2001. The six-month rate was the highest since 4.770 percent on Feb. 20, 2001.

The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,887.51 while a six-month bill sold for $9,770.23.

In a separate report, the Federal Reserve said Tuesday that the average yield for one-year Treasury bills, a popular index for making changes in adjustable rate mortgages, rose to 4.70 percent last week from 4.67 percent the previous week.



Will this sort of thing not pass on around the world once it gets started? So many UK financial companies work in this market. . . .


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I make the 3 month bills 4.551?

$10,000 / $9887.51 = 1.011377 which over a year is 1.04550 and bearing in mind the Fed rate is not set to change for a little over a month they are not a bad bet.

4.7 / 4.67 = 0.6% in a week so X52 = A 33% hike over a year.

Bad news for variable mortgages if that trend is sustained. That is tantamount to a 1.5% increase in the US interest rate. Taking the IR at the Federal Reserve to 6% by this time next year!

Most likely down to the acknowledgement that the Fed is going to raise their rates.

I wonder how much of this was bought up by Asian banks?

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  • 312 Brexit, House prices and Summer 2020

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      • down 5% +
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      • Even
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