Treasury Bill

Treasury bill means short-term debt issued by the U.S. government, usually with a maturity of one year or less. In simple terms, a Treasury bill is a short-term loan to the U.S. government. Treasury bills are important because they are often viewed as very safe short-term investments. Their yields can closely reflect expectations for short-term interest rates and Federal Reserve policy. For example, a 3-month Treasury bill matures after three months and pays investors through the difference between the purchase price and face value. A Treasury bill is not the same as a Treasury note. Bills are short-term and usually do not pay regular coupon interest, while notes have longer maturities and usually pay coupons.