Treasury bills


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Treasury bills

Debt obligations of the US Treasury that have maturities of one year or less. Maturities for T-bills are usually 91 days, 182 days, or 52 weeks. Treasury bills are sold at a discount from face value and do not pay interest before maturity. The interest is the difference between the purchase price of the bill and the amount that is paid to you either at maturity (this amount is the face value) or when you sell the bill prior to maturity.

Treasury Bill

A debt security backed by the full faith and credit of the United States government with a maturity of one year or less. Very commonly, T bills have a maturity of a few weeks to a few months. They are purchased at a discount and then redeemed for par; T bills do not pay interest. For example, an investor may purchase a $5,000 bill for $4,500. While he/she will not earn any coupon payments, he/she will receive $5,000 in no more than a year. They are low-risk, low-return investments. Private investors may purchase T bills in small quantities, but the bulk of the T bill market comes from institutional investors, especially banks. See also: Treasury note, Treasury bond.
References in periodicals archive ?
Furthermore, Treasury Bills promote the local money market by creating a benchmark yield curve for short-term interest rates.
They are also said to have made a letter head allegedly from the CBK for Treasury Bills of Sh347 million, which they purported to have been issued by Maina Warui, the registrar, and National Debt Office at CBK.
The bank issues treasury bills twice a month to help the government to finance its budget deficit, curb money supply growth and provide an avenue for lenders to manage liquidity.
81m through a treasury bill that has a maturity period of 91 days, from October 18 to January 17, 2018.
The Central Bank of Egypt (CBE) issued treasury bills for 91 days worth EGP 6.
Introducing state bonds and selling them as financial instruments, according to the professor, is generally acceptable instrument in the developed countries, especially in the Western economies where countries issue state bonds, in a form of treasury bills or securities, in order to secure funds on the financial market for financing budgetary needs.
In parallel, despite the gradual return to markets with the issuance of three-year and five-year bonds this year, Athens runs a monthly treasury bills auction program to raise supplementary financing.
The central bank has bought VND7tn seven-day treasury bills at a yield of 8.
3bn of treasury bills at its monthly auction in July 2004.
While not as low-risk as three-month Treasury bills, the risk is manageable and the return advantage significant.
While The Federal Reserve raised its discount rate five times since December 1998, the treasury market in February 2000 developed an inverted yield curve: in which treasury bill rates with longer maturities were priced lower than short-term treasury bills, thus signaling to investors that interest rates in the future would be lower than n current rates.
In a previous article about Treasury bonds (see "A Treasury Bond by Any Other Name," Moneywise, December 1999), we incorrectly stated the minimum denomination for Treasury bills, also called T-bills.