NEW YORK, Feb 11 (Reuters) - The interest rate on U.S. one-month Treasury bills fell to their lowest level in over a week on Tuesday after news that House of Representatives Republicans agreed to advance a “clean” bill on the raising the debt limit before the government is expected to run out of cash.
The drop in the one-month T-bill rate came shortly before the Treasury Department sells $8 billion worth of one-month debt supply at 11:30 a.m. (1630 GMT).
House Speaker John Boehner told reporters on Tuesday Republicans plan to advance a “clean” debt limit bill to the House floor on Wednesday. House Democratic leaders suggested there will be “broad support” for such a bill.
On the open market, the one-month T-bill rate was quoted at 0.04 percent in early trading, down 3 basis points from late on Monday, according to Reuters data.
In “when-issued” activity, traders expected the Treasury to pay investors and dealers 0.05 percent on the upcoming one-month bill supply due March 13. Last week, it sold $8 billion of one-month bills at an interest rate of 0.13 percent, which was the highest level since Oct. 16.