What is a commonly used proxy for the risk-free rate?

A commonly used proxy for the risk-free rate is the yield on government securities, particularly short-term Treasury bills, such as the 3-month U.S. Treasury bill. These securities are considered virtually risk-free due to the U.S. government's backing, making them a reliable benchmark for the risk-free rate in financial models and investment analyses. Other proxies may include longer-term Treasury bonds, but short-term bills are preferred for their sensitivity to current interest rate environments.