Treasury Bill

A Treasury bill, often abbreviated as T-bill, is a short-term debt obligation issued by the United States Department of the Treasury. It is a type of government bond with a maturity period typically ranging from a few days to one year. Investors purchase Treasury bills at a discount from their face value and receive the full face value when the bill matures. The difference between the purchase price and the face value represents the investor's interest earned on the investment. Treasury bills are considered one of the safest investments because they are backed by the full faith and credit of the U.S. government, making them virtually risk-free. They are highly liquid and serve as a benchmark for short-term interest rates. Treasury bills are commonly used by investors seeking a secure place to park their funds temporarily or by financial institutions to manage liquidity and meet short-term funding needs. They are also utilized by governments as a tool for managing public debt and financing government operations.