US 3-month bill yield hits 4% as Treasury auction demand weakens

US Treasury bill yields just crossed a threshold that tends to get people’s attention. Both 3-month and 6-month bills are now offering returns above 4%, a level that hasn’t been the norm for these short-term instruments during the summer months, when yields were comfortably parked in the 3.7% to 3.9% range. What the auction numbers show The September 14 Treasury auction moved $92 billion in 13-week bills at a high rate of 4.066%. The 26-week bills cleared $79 billion at 4.203%. The bid-to-cover ratios, which measure how many dollars of bids came in for each dollar of bills on offer, painted a less enthusiastic picture. The 3-month bid-to-cover came in at 2.64x, while the 6-month ratio landed at 2.74x. For context, 3-month bid-to-cover ratios dropped as low as 2.32x back in June 2026, and recent auctions have averaged around 2.6x. By September 21, secondary market yields had pushed even higher: 4.084% for 3-month bills and 4.279% for 6-month bills. The slow climb through September Yields on 6-month bills in the secondary market crept from 3.89% on September 4 to 3.95% by September 11. The auction on September 14 then punched through 4%, and secondary market trading in the days after...