October 22, 2012
Deborah ONeal-Johnson, Esquire
U.S. Securities & Exchange Commission
Division of Investment Management
100 F Street, N.E.
Washington, D.C. 20549
Re: T. Rowe Price U.S. Treasury Funds, Inc.
on behalf of the following series:
T. Rowe Price U.S. Treasury Intermediate Fund
T. Rowe Price U.S. Treasury Long-Term Fund
T. Rowe Price U.S. Treasury Money Fund
(collectively the funds)
File Nos.: 033-30531/811-5860
Dear Ms. ONeal-Johnson:
Pursuant to Rule 497 under the Securities Act of 1933, as amended, we are hereby filing interactive data files that contain the risk/return summary information set forth in response to Items 2, 3, and 4 of Form N-1A. The information in these eXtensible Business Reporting Language (XBRL) exhibits relates to the risk/return information presented in the revised prospectus that was filed under Rule 497 on October 9, 2012.
Please contact me at 410-345-6628, or in my absence, Brian R. Poole, at 410-345-6646, if we may be of further assistance.
Sincerely,
/s/Gina Hogan
Gina Hogan
U.S. Treasury Long-Term Fund | ||||||||||||||||||||||||
SUMMARY U.S. Treasury Long-Term Fund |
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Investment Objective | ||||||||||||||||||||||||
The fund seeks the highest level of income consistent with maximum credit protection. | ||||||||||||||||||||||||
Fees and Expenses | ||||||||||||||||||||||||
This table describes the fees and expenses that you may pay if you buy and hold shares of the fund. | ||||||||||||||||||||||||
Fees and Expenses of the Fund |
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(expenses that you pay each year as a percentage of the value of your investment) |
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Example | ||||||||||||||||||||||||
This example is intended to help you compare the cost of investing in the fund with the cost of investing in other mutual funds. The example assumes that you invest $10,000 in the fund for the time periods indicated and then redeem all of your shares at the end of those periods. The example also assumes that your investment has a 5% return each year, the funds operating expenses remain the same, and the expense limitation currently in place is not renewed. Although your actual costs may be higher or lower, based on these assumptions your costs would be: | ||||||||||||||||||||||||
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Portfolio Turnover | ||||||||||||||||||||||||
The fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the example, affect the funds performance. During the most recent fiscal year, the funds portfolio turnover rate was 57.1% of the average value of its portfolio. | ||||||||||||||||||||||||
Investments, Risks, and Performance Principal Investment Strategies |
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The fund invests at least 85% of its net assets (including any borrowings for investment purposes) in U.S. Treasury securities, which are backed by the full faith and credit of the federal government. The remainder is invested in other securities backed by the full faith and credit of the U.S. government. The funds weighted average maturity is expected to vary between 15 and 20 years, but may range from 10 to 30 years. U.S. Treasury securities in which the fund may invest include Treasury bills, notes, and bonds, and repurchase agreements thereon, as well as Treasury inflation protected securities and Treasury STRIPS, which are zero-coupon securities created by separating the principal and interest payments on U.S. Treasury securities. The funds other investments include the following:
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Principal Risks | ||||||||||||||||||||||||
As with any mutual fund, there is no guarantee that the fund will achieve its objective. The funds share price fluctuates, which means you could lose money by investing in the fund. While U.S. government-backed securities generally are considered to be among the highest credit quality, they are subject to market risk. The U.S. government guarantees the timely payment of interest and principal on Treasury securities but does not guarantee their price. The principal risks of investing in this fund are summarized as follows: Active management risk The fund is subject to the risk that the investment advisers judgments about the attractiveness, value, or potential appreciation of the funds investments may prove to be incorrect. If the securities selected and strategies employed by the fund fail to produce the intended results, the fund could underperform other funds with similar objectives and investment strategies. Interest rate risk This is the risk that a rise in interest rates will cause the price of a fixed rate debt security to fall. Prices fall because the bonds and notes in the funds portfolio become less attractive to other investors when securities with higher yields become available. Generally, securities with longer maturities and funds with longer weighted average maturities carry greater interest rate risk. Credit risk This is the risk that an issuer of a debt security could suffer an adverse change in financial condition that results in a payment default, security downgrade, or inability to meet a financial obligation. The fund should have relatively low credit risk because it invests only in securities backed by the U.S. government and other investments involving such securities. Liquidity risk This is the risk that the fund may not be able to sell a holding in a timely manner at a desired price. Repurchase agreement risk This is the risk that a counterparty to a repurchase agreement becomes insolvent or fails to repurchase securities from the fund as required, which could increase the funds costs or prevent the fund from immediately accessing its collateral. Derivatives risk To the extent the fund uses futures, it is exposed to additional volatility in comparison to investing directly in bonds and other debt securities. Futures can be illiquid and difficult to value and involve the risk that anticipated interest rate movements will not be accurately predicted. Treasury STRIPS are less liquid, potentially more volatile, and have a higher sensitivity to changes in interest rates than Treasury bonds with the same maturity. |
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Performance | ||||||||||||||||||||||||
The bar chart showing calendar year returns and the average annual total returns table indicate risk by illustrating how much returns can differ from one year to the next and how fund performance compares with that of a comparable market index. The funds past performance (before and after taxes) is not necessarily an indication of future performance. The fund can also experience short-term performance swings, as shown by the best and worst calendar quarter returns during the years depicted. |
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Calendar Year Returns |
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In addition, the average annual total returns table shows hypothetical after-tax returns to suggest how taxes paid by a shareholder may influence returns. After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on an investors tax situation and may differ from those shown. After-tax returns shown are not relevant to investors who hold their fund shares through tax-deferred arrangements, such as a 401(k) account or individual retirement account. | ||||||||||||||||||||||||
Average Annual Total Returns December 31, 2011 |
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Updated performance information is available through troweprice.com or may be obtained by calling 1-800-225-5132. |