T. Rowe Price Short Term Bond Fund (PRWBX) N-CSRS Certified semi-annual shareholder report (management investment company)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act File Number: 811-03894

T. Rowe Price Short-Term Bond Fund, Inc.

(Exact name of registrant as specified in charter)

100 East Pratt Street, Baltimore, MD 21202

(Address of principal executive offices)

David Oestreicher

100 East Pratt Street, Baltimore, MD 21202

(Name and address of agent for service)

Registrant’s telephone number, including area code:  (410) 345-2000

Date of fiscal year end:  May 31

Date of reporting period:  November 30, 2022

Item 1. Reports to Shareholders

(a) Report pursuant to Rule 30e-1

Highlights

and

Market

Commentary

Management’s

Discussion

of

Fund

Performance

Performance

and

Expenses

Financial

Highlights

Portfolio

of

Investments

Financial

Statements

and

Notes

Additional

Fund

Information

November

30,

2022

SemiAnnual

Report

For

more

insights

from

T.

Rowe

Price

investment

professionals,

go

to

troweprice.com

.

T.

ROWE

PRICE

TRBUX

Ultra

Short-Term

Bond

Fund

–

.

TRSTX

Ultra

Short-Term

Bond

Fund–

.

I  Class

TRZWX

Ultra

Short-Term

Bond

Fund–

.

Z Class

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

HIGHLIGHTS

The

fund

underperformed

its

benchmark

and

its

Lipper

peer

group

average

over

the

six-month

period

ended

November

30,

2022.

Front-end

fixed

income

markets

saw

continued

volatility

over

the

past

six

months,

with

the

yield

on

the

two-year

U.S.

Treasury

note

hitting

a

near-term

peak

in

October.

The

fund’s

credit

risk

exposure

increased

and

ended

the

period

around

the

midpoint

of

its

typical

range

as

we

added

investment-grade

corporate

bonds

that

offered

attractive

spreads.

While

it’s

possible

that

Treasury

rates

have

seen

their

peak

for

this

economic

cycle,

it’s

unclear

how

the

market

will

respond

to

a

period

of

higher-for-longer

interest

rate

policy.

Log

in

to

your

account

at

troweprice.com

for

more

information.

*

Certain

mutual

fund

accounts

that

are

assessed

an

annual

account

service

fee

can

also

save

money

by

switching

to

e-delivery.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

Market

Commentary

1

Dear

Shareholder

Global

stock

markets

generally

produced

negative

returns

during

the

first

half

of

your

fund’s

fiscal

year,

the

six-month

period

ended

November

30,

2022,

while

rising

bond

yields

weighed

on

returns

for

fixed

income

investors.

Investors

contended

with

tightening

financial

conditions

and

slowing

economic

and

corporate

earnings

growth,

but

hopes

that

persistently

high

inflation

might

be

easing

helped

spark

a

rally

late

in

the

period

that

partially

offset

earlier

losses.

In

the

U.S.,

equity

results

were

mixed.

The

Dow

Jones

Industrial

Average

recorded

positive

results

and

mid-cap

growth

stocks

also

performed

well,

while

most

other

benchmarks

finished

in

negative

territory.

The

S&P

500

Index

was

modestly

negative

for

the

period,

but

results

varied

widely

at

the

sector

level,

with

industrials

and

energy

shares

delivering

strong

gains

while

communication

services

stocks

struggled.

Outside

the

U.S.,

most

major

country

and

regional

benchmarks

lost

ground.

Emerging

markets

stocks

generally

underperformed

shares

in

developed

markets.

Meanwhile,

the

U.S.

dollar

strengthened

versus

most

currencies

during

the

period,

which

weighed

on

returns

for

U.S.

investors

in

international

securities.

Elevated

inflation

remained

a

leading

concern

for

investors

throughout

the

period,

although

hopes

that

inflation

may

have

peaked

led

to

rallies

during

the

summer

and

again

in

November.

The

October

consumer

price

index

report,

which

was

released

in

mid-November,

was

better

than

expected

and

showed

price

increases

easing

from

recent

40-year

highs.

However,

the

7.7%

year-over-

year

increase

in

the

headline

inflation

number

remained

well

above

the

Fed’s

2%

target.

In

response

to

the

high

inflation

readings,

global

central

banks

continued

to

tighten

monetary

policy,

and

investors

focused

on

communications

from

central

bank

officials

on

how

high

rates

would

have

to

go.

The

Federal

Reserve

delivered

four

historically

large

75-basis-point

(0.75

percentage

point)

rate

hikes

during

the

period,

which

lifted

its

short-term

lending

benchmark

to

a

target

range

of

3.75%

to

4.00%

by

early

November,

the

highest

level

since

2008.

As

our

reporting

period

came

to

an

end,

Fed

officials

signaled

that

they

were

likely

to

dial

back

the

pace

of

rate

increases.

Bond

yields

increased

considerably

across

the

Treasury

yield

curve

as

the

Fed

tightened

monetary

policy,

with

the

yield

on

the

benchmark

10-year

U.S.

Treasury

note

climbing

from

2.85%

at

the

start

of

the

period

to

3.68%

at

the

end

of

November.

Significant

inversions

in

the

Treasury

curve,

which

are

often

considered

a

warning

sign

of

a

coming

recession,

occurred

during

the

period

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

2

as

shorter-maturity

Treasuries

experienced

the

largest

yield

increases.

The

sharp

increase

in

yields

led

to

generally

negative

results

across

the

fixed

income

market

as

bond

prices

and

yields

move

in

opposite

directions.

On

a

positive

note,

the

U.S.

jobs

market

remained

resilient

during

the

period,

and

overall

economic

growth

turned

positive

in

the

third

quarter

after

two

slightly

negative

quarters.

However,

recession

fears

also

grew

as

corporate

earnings

slowed

and

manufacturing

gauges

drifted

toward

contraction

levels.

In

addition,

the

housing

market

began

to

weaken

as

mortgage

rates

climbed

to

the

highest

level

in

more

than

20

years.

The

past

year

has

been

a

trying

time

for

investors

as

few

sectors

remained

untouched

by

the

broad

headwinds

that

markets

faced,

and

volatility

may

continue

in

the

near

term

as

central

banks

tighten

policy

amid

slowing

economic

growth.

However,

in

our

view,

valuations

have

become

more

attractive

across

many

market

sectors

during

the

downturn,

which

provides

potential

opportunities

for

selective

investors

focused

on

fundamentals.

We

believe

this

environment

makes

skilled

active

management

a

critical

tool

for

identifying

risks

and

opportunities,

and

our

investment

teams

will

continue

to

use

fundamental

research

to

identify

securities

that

can

add

value

to

your

portfolio

over

the

long

term.

Thank

you

for

your

continued

confidence

in

T.

Rowe

Price.

Sincerely, 

Robert

Sharps

CEO

and

President

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

Management’s

Discussion

of

Fund

Performance

3

INVESTMENT

OBJECTIVE 

The

fund

seeks

a

high

level

of

income

consistent

with

minimal

fluctuation

in

principal

value

and

liquidity.

FUND

COMMENTARY

How

did

the

fund

perform

in

the

past six

months?

The

fund

returned

-0.16%

in

the

six-month

period

ended

November

30,

2022,

underperforming

its

benchmark,

the

Bloomberg

Short-Term

Government/

Corporate

Index,

as

well

as

its

Lipper

peer

group

average.

(Returns

for

I

and

Z

Class

shares

will

vary,

reflecting

their

different

fee

structures.

Past

performance

cannot

guarantee

future

results

.)

What

factors

influenced

the

fund’s

performance?

Front-end

fixed

income

markets

saw

continued

volatility

over

the

past

six

months,

with

the

yield

on

the

two-year

U.S.

Treasury

note

hitting

a

near-term

peak

in

October.

Against

this

backdrop,

corporate

bonds

produced

negative

absolute

returns

as

rising

Treasury

yields

dragged

bond

prices

lower.

Corporate

credit

spreads

were

volatile,

with

spreads

ranging

between

pricing

in

a

benign

environment

to

near-recessionary

levels.

However,

in

a

welcome

change

from

recent

periods,

credit

spreads

ended

the

period

roughly

flat

as

opposed

to

moving

higher

alongside

rates.

(Credit

spreads

are

a

measure

of

the

additional

yield

offered

by

bonds

that

have

credit

risk

compared

with

U.S.

Treasuries

with

similar

maturities.)

Treasuries

depreciated

over

the

reporting

period.

Front-end

Treasury

yields

rose

throughout

most

of

the

period

as

investors

priced

in

a

higher-for-longer

interest

rate

regime.

However,

yields

on

Treasury

notes

and

bonds

moved

lower

in

November

as

inflation,

while

still

elevated,

showed

signs

of

steadily

declining

and

the

Fed

delivered

more

clarity

around

its

terminal

policy

rate.

The

economic

environment

remained

resilient,

but

growth

showed

clear

signs

PERFORMANCE

COMPARISON

Six-Month

Period

Ended

11/30/22

Total

Return

Ultra

Short-Term

Bond

Fund

–

.

-0.16‌%

Ultra

Short-Term

Bond

Fund–

.

I  Class

-0.10‌

Ultra

Short-Term

Bond

Fund–

.

Z

Class

0.00‌

Bloomberg

Short-Term

Government/

Corporate

Index

0.42‌

Lipper

Ultra-Short

Obligations

Funds

Average

0.39‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

4

of

slowing,

and

concerns

over

a

possible

recession

also

played

a

role

in

pushing

Treasury

yields

lower.

The

two-year

U.S.

Treasury

yield

began

the

period

at

2.53%,

rose

to

4.72%

near

the

start

of

November,

and

ended

the

period

at

4.38%.

Sector

allocations

detracted

from

the

fund’s

relative

performance

in

aggregate.

Out-of-benchmark

allocations

to

securitized

sectors,

including

commercial

mortgage-backed

securities,

asset-backed

securities

(ABS),

and

residential

mortgage-backed

securities

(RMBS),

weighed

on

relative

results

alongside

volatility

in

the

rates

market.

Our

allocation

to

RMBS

was

a

prominent

detractor

as

rising

interest

rates

led

to

a

slowdown

in

mortgage

prepayments,

which

caused

maturities

to

extend

and

the

prices

of

these

securities

to

fall.

Conversely,

an

overweight

to

investment-grade

corporate

bonds

and

a

corresponding

underweight

to

U.S.

Treasuries

supported

relative

performance

as

hopes

of

a

dovish

pivot

from

the

Fed

led

to

a

late-period

rally

in

credit

spreads.

In

aggregate,

interest

rate

management

weighed

on

relative

results,

as

the

positive

impact

of

key

rate

duration

positioning

could

not

overcome

the

cost

of

carry

(cost

of

ownership)

from

our

intermediate-term

interest

rate

future

contracts.

We

make

modest

use

of

these

contracts

to

hedge

our

interest

rate

risk

within

the

fund.

Additionally,

the

portfolio’s

average

duration

profile,

which

was

shorter

than

that

of

the

benchmark,

made

up

for

some

losses

as

U.S.

Treasury

yields

rose

broadly

across

the

yield

curve.

(Duration

measures

a

bond’s

or

a

bond

fund’s

sensitivity

to

changes

in

interest

rates.)

Security

selection

within

investment-grade

corporate

bonds

also

modestly

hindered

relative

performance.

Bonds

in

the

banking

sector

were

hurt

by

heightened

global

recession

concerns

as

well

as

concerns

that

slowing

global

growth

and

higher

inflation

may

reduce

lending

margins.

As

mentioned

previously,

while

we

are

primarily

a

cash

bond

manager,

we

employ

the

limited

use

of

derivatives

in

our

strategy

for

hedging

purposes.

Derivatives

may

include

futures

and

options,

as

well

as

credit

default

and

interest

rate

swaps.

During

the

reporting

period,

our

use

of

derivatives,

particularly

Treasury

futures,

contributed

to

absolute

performance.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

5

How

is

the

fund

positioned?

The

fund

remained

defensively

positioned

in

a

rising

yield

environment,

with

duration

falling

below

the

low

end

of

the

fund’s

0.5-

to

1.0-year

target

range

early

in

the

period

and

remaining

there

through

period-end.

The

fund’s

credit

risk

exposure

increased

and

ended

the

period

around

the

midpoint

of

its

typical

range

as

we

added

investment-grade

corporate

bonds

that

were

offering

attractive

spreads.

We

maintained

our

above-average

allocation

to

liquid

assets

for

use

during

future

periods

of

credit

spread

widening.

The

portfolio

has

maintained

exposure

to

a

variety

of

fixed

income

credit

sectors

but

has

gradually

shifted

away

from

RMBS

in

favor

of

investment-grade

corporate

bonds

and

ABS.

RMBS

will

continue

to

have

a

position

in

the

fund

going

forward

but

will

likely

play

a

smaller

role

than

it

has

historically.

Volatility

in

credit

spreads

provided

opportunities

to

add

corporate

bonds

at

discounted

levels,

and

corporate

debt

represented

nearly

60%

of

the

fund’s

holdings

as

of

November

30,

2022.

While

market

stresses

have

continued,

our

research

team

remains

confident

in

the

increased

resilience

of

balance

sheets

and

responsible

capital

allocation

decisions

from

management

teams.

What

is

portfolio

management’s

outlook?

The

U.S.

economy

has

held

up

remarkably

well

given

multi-decade

highs

in

inflation

and

the

Fed

aggressively

tightening

monetary

policy.

As

we

head

into

2023,

this

resilience

will

be

tested

as

monetary

policy

becomes

even

tighter

and

earnings

growth

and

the

job

market

both

likely

slow

from

the

levels

seen

in

2022.

This

macro

backdrop

sets

up

a

return

to

a

more

normalized

market

Sources:

Credit

ratings

for

the

securities

held

in

the

fund

are

provided

by

Moody’s,

Standard

&

Poor’s,

and

Fitch

and

are

converted

to

the

Standard

&

Poor’s

nomenclature.

A

rating

of

AAA

represents

the

highest-

rated

securities,

and

a

rating

of

D

represents

the

lowest-

rated

securities.

If

the

rating

agencies

differ,

the

highest

rating

is

applied

to

the

security.

If

a

rating

is

not

available,

the

security

is

classified

as

Not

Rated.

T.

Rowe

Price

uses

the

rating

of

the

underlying

investment

vehicle

to

determine

the

creditworthiness

of

credit

default

swaps.

The

fund

is

not

rated

by

any

agency.

Securities

that

have

not

been

rated

by

any

rating

agency

totaled

0.19%

of

the

portfolio

at

the

end

of

the

reporting

period.

CREDIT

QUALITY

DIVERSIFICATION

Ultra

Short-Term

Bond

Fund

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

6

environment

in

which

interest

rates

and

credit

spreads

could

resume

their

historical

relationship

of

moving

in

opposite

directions.

When

combined

with

higher

starting

yields,

the

reemergence

of

this

historical

relationship

would

produce

an

environment

more

conducive

to

positive

total

returns

even

if

the

market

once

again

becomes

concerned

over

a

potential

recession.

While

it’s

possible

that

Treasury

rates

have

seen

their

peak

for

this

economic

cycle,

it’s

unclear

how

the

market

will

respond

to

a

period

of

higher-for-longer

interest

rate

policy.

This

should

keep

some

uncertainty

over

the

future

path

of

interest

rates

but

decidedly

less

so

than

earlier

this

year

when

rates

were

much

lower

than

inflation.

In

the

current

environment

of

heightened

volatility,

active

management

can

play

an

even

more

instrumental

part

in

achieving

investor

objectives.

Our

continued

goal

is

to

provide

high-quality,

durable

yield

and

income

appropriate

for

an

ultra

short-term

bond

strategy

with

modest

credit

and

duration

risk.

Using

the

breadth

and

depth

of

our

global

research

platform,

we

will

look

to

selectively

add

to

high-conviction

positions

as

volatility

creates

attractive

entry

points.

The

views

expressed

reflect

the

opinions

of

T.

Rowe

Price

as

of

the

date

of

this

report

and

are

subject

to

change

based

on

changes

in

market,

economic,

or

other

conditions.

These

views

are

not

intended

to

be

a

forecast

of

future

events

and

are

no

guarantee

of

future

results.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

7

RISKS

OF

BOND

INVESTING

The

value

of

investments

held

by

the

fund

may

decline,

sometimes

rapidly

or

unpredictably,

due

to

factors

affecting

certain

issuers,

particular

industries

or

sectors,

or

the

overall

markets.

Rapid

or

unexpected

changes

in

market

conditions

could

cause

the

fund

to

liquidate

its

holdings

at

inopportune

times

or

at

a

loss

or

depressed

value.

Rapid

changes

in

interest

rates

may

increase

the

fund’s

overall

exposure

to

interest

rate

risk.

A

fund

investing

in

mortgage-

backed

securities,

certain

asset-backed

securities,

and

other

debt

instruments

that

have

embedded

call

options

can

be

negatively

impacted

when

interest

rates

fall

because

borrowers

tend

to

refinance

and

prepay

principal.

The

fund’s

investments

outside

the

U.S.

are

subject

to

special

risks,

whether

the

securities

(including

depositary

receipts

and

other

instruments

that

represent

interests

in

a

non-U.S.

issuer)

are

denominated

in

U.S.

dollars

or

foreign

currencies.

These

risks

include

potentially

adverse

local,

political,

social,

and

economic

conditions

overseas;

greater

volatility;

lower

liquidity;

and

the

possibility

that

settlement

practices

and

regulatory

and

accounting

standards

will

differ

from

those

of

U.S.

issuers.

An

issuer

of

a

debt

instrument

held

by

the

fund

could

default

(fail

to

make

scheduled

interest

or

principal

payments),

potentially

reducing

the

fund’s

income

and

share

price.

BENCHMARK

INFORMATION

Note:

Bloomberg

®

and

Bloomberg

Short-Term

Government/Corporate

Index

are

service

marks

of

Bloomberg

Finance

L.P.

and

its

affiliates,

including

Bloomberg

Index

Services

Limited

(“BISL”),

the

administrator

of

the

index

(collectively,

“Bloomberg”)

and

have

been

licensed

for

use

for

certain

purposes

by

T.

Rowe

Price.

Bloomberg

is

not

affiliated

with

T.

Rowe

Price,

and

Bloomberg

does

not

approve,

endorse,

review,

or

recommend

its

products.

Bloomberg

does

not

guarantee

the

timeliness,

accurateness,

or

completeness

of

any

data

or

information

relating

to

its

products. 

Note:

Copyright

©

2022

Fitch

Ratings,

Inc.,

Fitch

Ratings

Ltd.

and

its

subsidiaries.

Note:

Portions

of

the

mutual

fund

information

contained

in

this

report

were

supplied

by

Lipper,

a

Refinitiv

Company,

subject

to

the

following:

Copyright

2022

©

Refinitiv.

All

rights

reserved.

Any

copying,

republication

or

redistribution

of

Lipper

content

is

expressly

prohibited

without

the

prior

written

consent

of

Lipper.

Lipper

shall

not

be

liable

for

any

errors

or

delays

in

the

content,

or

for

any

actions

taken

in

reliance

thereon.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

8

Note:

©

2022,

Moody’s

Corporation,

Moody’s

Investors

Service,

Inc.,

Moody’s

Analytics,

Inc.

and/or

their

licensors

and

affiliates

(collectively,

“Moody’s”).

All

rights

reserved.

Moody’s

ratings

and

other

information

(“Moody’s

Information”)

are

proprietary

to

Moody’s

and/or

its

licensors

and

are

protected

by

copyright

and

other

intellectual

property

laws.

Moody’s

Information

is

licensed

to

Client

by

Moody’s.

MOODY’S

INFORMATION

MAY

NOT

BE

COPIED

OR

OTHERWISE

REPRODUCED,

REPACKAGED,

FURTHER

TRANSMITTED,

TRANSFERRED,

DISSEMINATED,

REDISTRIBUTED

OR

RESOLD,

OR

STORED

FOR

SUBSEQUENT

USE

FOR

ANY

SUCH

PURPOSE,

IN

WHOLE

OR

IN

PART,

IN

ANY

FORM

OR

MANNER

OR

BY

ANY

MEANS

WHATSOEVER,

BY

ANY

PERSON

WITHOUT

MOODY’S

PRIOR

WRITTEN

CONSENT.

Moody's

®

is

a

registered

trademark.

Note:

Copyright

©

2022,

S&P

Global

Market

Intelligence

(and

its

affiliates,

as

applicable).

Reproduction

of

any

information,

data

or

material,

including

ratings

("Content")

in

any

form

is

prohibited

except

with

the

prior

written

permission

of

the

relevant

party. Such

party,

its

affiliates

and

suppliers

("Content

Providers")

do

not

guarantee

the

accuracy,

adequacy,

completeness,

timeliness

or

availability

of

any

Content

and

are

not

responsible

for

any

errors

or

omissions

(negligent

or

otherwise),

regardless

of

the

cause,

or

for

the

results

obtained

from

the

use

of

such

Content.

In

no

event

shall

Content

Providers

be

liable

for

any

damages,

costs,

expenses,

legal

fees,

or

losses

(including

lost

income

or

lost

profit

and

opportunity

costs)

in

connection

with

any

use

of

the

Content.

A

reference

to

a

particular

investment

or

security,

a

rating

or

any

observation

concerning

an

investment

that

is

part

of

the

Content

is

not

a

recommendation

to

buy,

sell

or

hold

such

investment

or

security,

does

not

address

the

appropriateness

of

an

investment

or

security

and

should

not

be

relied

on

as

investment

advice.

Credit

ratings

are

statements

of

opinions

and

are

not

statements

of

fact.

BENCHMARK

INFORMATION

(continued)

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

9

GROWTH

OF

$10,000 

This

chart

shows

the

value

of

a

hypothetical

$10,000

investment

in

the

fund

over

the

past

10

fiscal

year

periods

or

since

inception

(for funds

lacking

10-year

records).

The

result

is

compared

with

benchmarks,

which

include

a

broad-based

market

index

and

may

also

include

a

peer

group

average

or

index.

Market

indexes

do

not

include

expenses,

which

are

deducted

from

fund

returns

as

well

as

mutual fund

averages

and

indexes.

ULTRA

SHORT-TERM

BOND

FUND 

*The

Lipper

Ultra-Short

Obligations

Funds

Average

is

from

12/31/12.

Note:

Performance

for

the

I

and

Z Class

shares

will

vary

due

to

their

differing

fee

structures.

See

the

Average

Annual

Compound

Total

Return

table. 

AVERAGE

ANNUAL

COMPOUND

TOTAL

RETURN

Periods

Ended

11/30/22

1

Year

5

Years

Since

Inception

Inception

Date

Ultra

Short-Term

Bond

Fund

–

.

-1.52‌%

1.48‌%

1.21‌%

12/3/12

Ultra

Short-Term

Bond

Fund–

.

I  Class

-1.19‌

1.61‌

1.62‌

7/6/17

Ultra

Short-Term

Bond

Fund–

.

Z  Class

-1.01‌

–‌

-0.44‌

2/22/21

This

table

shows

how

the

fund

would

have

performed

each

year

if

its

actual

(or

cumulative)

returns

for

the

periods

shown

had

been

earned

at

a

constant

rate.

Returns

do

not

reflect

taxes

that

the

shareholder

may

pay

on

fund

distributions

or

the

redemption

of

fund

shares.

Past

performance

cannot

guarantee

future

results.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

10

EXPENSE

RATIO

FUND

EXPENSE

EXAMPLE

As

a

mutual

fund

shareholder,

you

may

incur

two

types

of

costs:

(1)

transaction

costs,

such

as

redemption

fees

or

sales

loads,

and

(2)

ongoing

costs,

including

management

fees,

distribution

and

service

(12b-1)

fees,

and

other

fund

expenses.

The

following

example

is

intended

to

help

you

understand

your

ongoing

costs

(in

dollars)

of

investing

in

the

fund

and

to

compare

these

costs

with

the

ongoing

costs

of

investing

in

other

mutual

funds.

The

example

is

based

on

an

investment

of

$1,000

invested

at

the

beginning

of

the

most

recent

six-month

period

and

held

for

the

entire

period.

Please

note

that

the

fund

has

three

share

classes:

The

original

share

class

(Investor

Class)

charges

no

distribution

and

service

(12b-1)

fee,

I

Class

shares

are

also

available

to

institutionally

oriented

clients

and

impose

no

12b-1

or

administrative

fee

payment,

and

Z

Class

shares

are

offered

only

to

funds

advised

by

T.

Rowe

Price

and

other

advisory

clients

of

T.

Rowe

Price

or

its

affiliates

that

are

subject

to

a

contractual

fee

for

investment

management

services

and

impose

no

12b-1

fee

or

administrative

fee

payment.

Each

share

class

is

presented

separately

in

the

table.

Actual

Expenses

The

first

line

of

the

following

table

(Actual)

provides

information

about

actual

account

values

and

expenses

based

on

the

fund’s

actual

returns.

You

may

use

the

information

on

this

line,

together

with

your

account

balance,

to

estimate

the

expenses

that

you

paid

over

the

period.

Simply

divide

your

account

value

by

$1,000

(for

example,

an

$8,600

account

value

divided

by

$1,000

=

8.6),

then

multiply

the

result

by

the

number

on

the

first

line

under

the

heading

“Expenses

Paid

During

Period”

to

estimate

the

expenses

you

paid

on

your

account

during

this

period.

Hypothetical

Example

for

Comparison

Purposes

The

information

on

the

second

line

of

the

table

(Hypothetical)

is

based

on

hypothetical

account

values

and

expenses

derived

from

the

fund’s

actual

expense

ratio

and

an

assumed

5%

per

year

rate

of

return

before

expenses

(not

the

fund’s

actual

return).

You

may

compare

the

ongoing

costs

of

investing

in

the

fund

with

other

funds

by

contrasting

this

5%

hypothetical

example

and

the

5%

hypothetical

examples

that

appear

in

the

shareholder

reports

of

the

other

funds.

The

hypothetical

account

values

and

expenses

may

not

be

used

to

estimate

the

actual

ending

account

balance

or

expenses

you

paid

for

the

period.

Ultra

Short-Term

Bond

Fund

0.31‌%

Ultra

Short-Term

Bond

Fund–I

Class

0.18‌ 

Ultra

Short-Term

Bond

Fund–Z

Class

0.20‌ 

The

expense

ratio

shown

is

as

of

the

fund’s

most

recent

prospectus.

This

number

may

vary

from

the

expense

ratio

shown

elsewhere

in

this

report

because

it

is

based

on

a

different

time

period

and,

if

applicable,

includes

acquired

fund

fees

and

expenses

but

does

not

include

fee

or

expense

waivers.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

11

Note:

T.

Rowe

Price

charges

an

annual

account

service

fee

of

$20,

generally

for

accounts

with

less

than

$10,000.

The

fee

is

waived

for

any

investor

whose

T.

Rowe

Price

mutual

fund

accounts

total

$50,000

or

more;

accounts

electing

to

receive

electronic

delivery

of

account

statements,

transaction

confirmations,

prospectuses,

and

shareholder

reports;

or

accounts

of

an

investor

who

is

a

T.

Rowe

Price

Personal

Services

or

Enhanced

Personal

Services

client

(enrollment

in

these

programs

generally

requires

T.

Rowe

Price

assets

of

at

least

$250,000).

This

fee

is

not

included

in

the

accompanying

table.

If

you

are

subject

to

the

fee,

keep

it

in

mind

when

you

are

estimating

the

ongoing

expenses

of

investing

in

the

fund

and

when

comparing

the

expenses

of

this

fund

with

other

funds.

You

should

also

be

aware

that

the

expenses

shown

in

the

table

highlight

only

your

ongoing

costs

and

do

not

reflect

any

transaction

costs,

such

as

redemption

fees

or

sales

loads.

Therefore,

the

second

line

of

the

table

is

useful

in

comparing

ongoing

costs

only

and

will

not

help

you

determine

the

relative

total

costs

of

owning

different

funds.

To

the

extent

a

fund

charges

transaction

costs,

however,

the

total

cost

of

owning

that

fund

is

higher.

ULTRA

SHORT-TERM

BOND

FUND

Beginning

Account

Value

6/1/22

Ending

Account

Value

11/30/22

Expenses

Paid

During

Period*

6/1/22

to

11/30/22

Investor

Class

Actual

$1,000.00

$998.40

$1.55

Hypothetical

(assumes

5%

return

before

expenses)

 1,000.00

  1,023.51

  1.57

I

Class

Actual

  1,000.00

  999.00

  0.95

Hypothetical

(assumes

5%

return

before

expenses)

 1,000.00

  1,024.12

  0.96

Z

Class

Actual

  1,000.00

  1,000.00

  0.00

Hypothetical

(assumes

5%

return

before

expenses)

 1,000.00

  1,025.07

  0.00

*

Expenses

are

equal

to

the

fund’s

annualized

expense

ratio

for

the

6-month

period,

multiplied

by

the

average

account

value

over

the

period,

multiplied

by

the

number

of

days

in

the

most

recent

fiscal

half

year

(183),

and

divided

by

the

days

in

the

year

(365)

to

reflect

the

half-year

period.

The

annualized

expense

ratio

of

the

1

Investor

Class

was

0.31%,

the

2

I Class

was

0.19%,

and

the

3

Z Class

was

0.00%.

FUND

EXPENSE

EXAMPLE

(CONTINUED)

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

12

QUARTER-END

RETURNS

Periods

Ended

9/30/22

1

Year

5

Years

Since

Inception

Inception

Date

Ultra

Short-Term

Bond

Fund

–

.

-1.82‌%

1.49‌%

1.20‌%

12/3/12

Ultra

Short-Term

Bond

Fund–

.

I  Class

-1.69‌ 

1.62‌ 

1.62‌ 

7/6/17

Ultra

Short-Term

Bond

Fund–

.

Z  Class

-1.50‌ 

–‌

-0.66‌ 

2/22/21

The

fund’s

performance

information

represents

only

past

performance

and

is

not

necessarily

an

indication

of

future

results.

Current

performance

may

be

lower

or

higher

than

the

performance

data

cited.

Share

price,

principal

value,

and

return

will

vary,

and

you

may

have

a

gain

or

loss

when

you

sell

your

shares.

For

the

most

recent

month-end

performance,

please

visit

our

website

(troweprice.com)

or

contact

a

T.

Rowe

Price

representative

at

1

-

800

-

225

-

5132

or,

for

2

I

and

3

Z

Class

shares,

1-800-638-8790

.

This

table

provides

returns

through

the

most

recent

calendar

quarter-end

rather

than

through

the

end

of

the

fund’s

fiscal

period.

It

shows

how

each

class

would

have

performed

each

year

if

its

actual

(or

cumulative)

returns

for

the

periods

shown

had

been

earned

at

a

constant

rate.

Average

annual

total

return

figures

include

changes

in

principal

value,

reinvested

dividends,

and

capital

gain

distributions.

Returns

do

not

reflect

taxes

that

the

shareholder

may

pay

on

fund

distributions

or

the

redemption

of

fund

shares.

When

assessing

performance,

investors

should

consider

both

short-

and

long-term

returns.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

(Unaudited)

Financial

Highlights

13

For

a

share

outstanding

throughout

each

period

Investor

Class

6

Months

.

Ended

11/30/22

..

Year

..

..

Ended

.

5/31/22

5/31/21

5/31/20

5/31/19

5/31/18

NET

ASSET

VALUE

Beginning

of

period

$

4

.96‌

$

5

.09‌

$

5

.02‌

$

5

.03‌

$

5

.01‌

$

5

.02‌

Investment

activities

Net

investment

income

(1)(2)

0

.05‌

0

.04‌

0

.06‌

0

.12‌

0

.14‌

0

.10‌

Net

realized

and

unrealized

gain/loss

(

0

.06‌

)

(

0

.11‌

)

0

.08‌

(

0

.01‌

)

0

.02‌

(

0

.02‌

)

Total

from

investment

activities

(

0

.01‌

)

(

0

.07‌

)

0

.14‌

0

.11‌

0

.16‌

0

.08‌

Distributions

Net

investment

income

(

0

.05‌

)

(

0

.04‌

)

(

0

.06‌

)

(

0

.12‌

)

(

0

.14‌

)

(

0

.09‌

)

Net

realized

gain

—‌

(

0

.02‌

)

(

0

.01‌

)

—‌

—‌

—‌

Total

distributions

(

0

.05‌

)

(

0

.06‌

)

(

0

.07‌

)

(

0

.12‌

)

(

0

.14‌

)

(

0

.09‌

)

NET

ASSET

VALUE

End

of

period

$

4

.90‌

$

4

.96‌

$

5

.09‌

$

5

.02‌

$

5

.03‌

$

5

.01‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

(Unaudited)

Financial

Highlights

14

For

a

share

outstanding

throughout

each

period

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Investor

Class

6

Months

.

Ended

11/30/22

..

Year

..

..

Ended

.

5/31/22

5/31/21

5/31/20

5/31/19

5/31/18

Ratios/Supplemental

Data

Total

return

(2)(3)

(

0

.16‌

)

%

(

1

.41‌

)

%

2

.75‌

%

2

.21‌

%

3

.27‌

%

1

.68‌

%

Ratios

to

average

net

assets:

(2)

Gross

expenses

before

waivers/

payments

by

Price

Associates

(4)

0

.33‌

%

(5)

0

.36‌

%

0

.45‌

%

0

.44‌

%

0

.42‌

%

0

.42‌

%

Net

expenses

after

waivers/payments

by

Price

Associates

0

.31‌

%

(5)

0

.33‌

%

0

.35‌

%

0

.35‌

%

0

.35‌

%

0

.35‌

%

Net

investment

income

2

.01‌

%

(5)

0

.72‌

%

1

.12‌

%

2

.34‌

%

2

.79‌

%

1

.87‌

%

Portfolio

turnover

rate

15

.1‌

%

56

.2‌

%

45

.8‌

%

69

.8‌

%

40

.1‌

%

42

.1‌

%

Net

assets,

end

of

period

(in

millions)

$1,845

$2,409

$4,169

$1,869

$1,164

$615

0‌

%

0‌

%

0‌

%

0‌

%

0‌

%

0‌

%

(1)

Per

share

amounts

calculated

using

average

shares

outstanding

method.

(2)

See

Note

6

for

details

of

expense-related

arrangements

with

Price

Associates.

(3)

Total

return

reflects

the

rate

that

an

investor

would

have

earned

on

an

investment

in

the

fund

during

each

period,

assuming

reinvestment

of

all

distributions,

and

payment

of

no

redemption

or

account

fees,

if

applicable.

Total

return

is

not

annualized

for

periods

less

than

one

year.

(4)

See

Note

6.

Prior

to

5/31/20,

the

gross

expense

ratios

presented

are

net

of

a

management

fee

waiver

in

effect

during

the

period,

as

applicable.

(5)

Annualized

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

(Unaudited)

Financial

Highlights

15

For

a

share

outstanding

throughout

each

period

I

Class

6

Months

.

Ended

11/30/22

..

Year

..

..

Ended

.

7/6/17

(1)

Through

5/31/18

5/31/22

5/31/21

5/31/20

5/31/19

NET

ASSET

VALUE

Beginning

of

period

$

4

.97‌

$

5

.10‌

$

5

.03‌

$

5

.04‌

$

5

.01‌

$

5

.02‌

Investment

activities

Net

investment

income

(2)(3)

0

.05‌

0

.04‌

0

.06‌

0

.12‌

0

.14‌

0

.10‌

Net

realized

and

unrealized

gain/loss

(

0

.05‌

)

(

0

.11‌

)

0

.09‌

(

0

.01‌

)

0

.03‌

(

0

.02‌

)

Total

from

investment

activities

—‌

(4)

(

0

.07‌

)

0

.15‌

0

.11‌

0

.17‌

0

.08‌

Distributions

Net

investment

income

(

0

.06‌

)

(

0

.04‌

)

(

0

.07‌

)

(

0

.12‌

)

(

0

.14‌

)

(

0

.09‌

)

Net

realized

gain

—‌

(

0

.02‌

)

(

0

.01‌

)

—‌

—‌

—‌

Total

distributions

(

0

.06‌

)

(

0

.06‌

)

(

0

.08‌

)

(

0

.12‌

)

(

0

.14‌

)

(

0

.09‌

)

NET

ASSET

VALUE

End

of

period

$

4

.91‌

$

4

.97‌

$

5

.10‌

$

5

.03‌

$

5

.04‌

$

5

.01‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

(Unaudited)

Financial

Highlights

16

For

a

share

outstanding

throughout

each

period

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

I

Class

6

Months

.

Ended

11/30/22

..

Year

..

..

Ended

.

7/6/17

(1)

Through

5/31/18

5/31/22

5/31/21

5/31/20

5/31/19

Ratios/Supplemental

Data

Total

return

(3)(5)

(

0

.10‌

)

%

(

1

.27‌

)

%

2

.88‌

%

2

.31‌

%

3

.47‌

%

1

.52‌

%

Ratios

to

average

net

assets:

(3)

Gross

expenses

before

waivers/

payments

by

Price

Associates

(6)

0

.19‌

%

(7)

0

.22‌

%

0

.32‌

%

0

.33‌

%

0

.35‌

%

0

.36‌

%

(7)

Net

expenses

after

waivers/payments

by

Price

Associates

0

.19‌

%

(7)

0

.19‌

%

0

.23‌

%

0

.25‌

%

0

.35‌

%

0

.35‌

%

(7)

Net

investment

income

2

.13‌

%

(7)

0

.87‌

%

1

.20‌

%

2

.47‌

%

2

.79‌

%

2

.11‌

%

(7)

Portfolio

turnover

rate

15

.1‌

%

56

.2‌

%

45

.8‌

%

69

.8‌

%

40

.1‌

%

42

.1‌

%

Net

assets,

end

of

period

(in

thousands)

$1,054,081

$1,288,432

$855,064

$263,120

$165,192

$110,678

0‌

%

0‌

%

0‌

%

0‌

%

0‌

%

0‌

%

(1)

Inception

date

(2)

Per

share

amounts

calculated

using

average

shares

outstanding

method.

(3)

See

Note

6

for

details

of

expense-related

arrangements

with

Price

Associates.

(4)

Amounts

round

to

less

than

$0.01

per

share.

(5)

Total

return

reflects

the

rate

that

an

investor

would

have

earned

on

an

investment

in

the

fund

during

each

period,

assuming

reinvestment

of

all

distributions,

and

payment

of

no

redemption

or

account

fees,

if

applicable.

Total

return

is

not

annualized

for

periods

less

than

one

year.

(6)

See

Note

6.

Prior

to

5/31/20,

the

gross

expense

ratios

presented

are

net

of

a

management

fee

waiver

in

effect

during

the

period,

as

applicable.

(7)

Annualized

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

(Unaudited)

Financial

Highlights

17

For

a

share

outstanding

throughout

each

period

Z

Class

(1)

6

Months

.

Ended

11/30/22

.

.

Year

Ended

5/31/22

2/22/21

(1)

Through

5/31/21

NET

ASSET

VALUE

Beginning

of

period

$

4

.97‌

$

5

.09‌

$

5

.10‌

Investment

activities

Net

investment

income

(2)(3)

0

.06‌

0

.05‌

0

.02‌

Net

realized

and

unrealized

gain/loss

(

0

.06‌

)

(

0

.10‌

)

(

0

.01‌

)

(4)

Total

from

investment

activities

—‌

(5)

(

0

.05‌

)

0

.01‌

Distributions

Net

investment

income

(

0

.06‌

)

(

0

.05‌

)

(

0

.02‌

)

Net

realized

gain

—‌

(

0

.02‌

)

—‌

Total

distributions

(

0

.06‌

)

(

0

.07‌

)

(

0

.02‌

)

NET

ASSET

VALUE

End

of

period

$

4

.91‌

$

4

.97‌

$

5

.09‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

(Unaudited)

Financial

Highlights

18

For

a

share

outstanding

throughout

each

period

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Z

Class

(1)

6

Months

.

Ended

11/30/22

.

.

Year

Ended

5/31/22

2/22/21

(1)

Through

5/31/21

Ratios/Supplemental

Data

Total

return

(3)(6)

0

.00‌

%

(

0

.89‌

)

%

0

.11‌

%

Ratios

to

average

net

assets:

(3)

Gross

expenses

before

waivers/payments

by

Price

Associates

0

.18‌

%

(7)

0

.25‌

%

0

.33‌

%

(7)

Net

expenses

after

waivers/payments

by

Price

Associates

0

.00‌

%

(7)

0

.00‌

%

0

.00‌

%

(7)

Net

investment

income

2

.35‌

%

(7)

1

.06‌

%

1

.13‌

%

(7)

Portfolio

turnover

rate

15

.1‌

%

56

.2‌

%

45

.8‌

%

Net

assets,

end

of

period

(in

thousands)

$96

$97

$100

0‌

%

0‌

%

0‌

%

(1)

Inception

date

(2)

Per

share

amounts

calculated

using

average

shares

outstanding

method.

(3)

See

Note

6

for

details

of

expense-related

arrangements

with

Price

Associates.

(4)

The

amount

presented

is

inconsistent

with

the

fund's

aggregate

gains

and

losses

because

of

the

timing

of

sales

and

redemptions

of

fund

shares

in

relation

to

fluctuating

market

values

for

the

investment

portfolio.

(5)

Amounts

round

to

less

than

$0.01

per

share.

(6)

Total

return

reflects

the

rate

that

an

investor

would

have

earned

on

an

investment

in

the

fund

during

each

period,

assuming

reinvestment

of

all

distributions,

and

payment

of

no

redemption

or

account

fees,

if

applicable.

Total

return

is

not

annualized

for

periods

less

than

one

year.

(7)

Annualized

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

November

30,

2022

(Unaudited)

19

Portfolio

of

Investments

‡

Par/Shares

$

Value

(Amounts

in

000s)

‡

ASSET-BACKED

SECURITIES

11.9%

Auto

Backed

6.9%

AmeriCredit

Automobile

Receivables

Trust

Series

2020-2,

Class

B

0.97%,

2/18/26 

800‌

780‌

AmeriCredit

Automobile

Receivables

Trust

Series

2020-3,

Class

B

0.76%,

12/18/25 

7,500‌

7,215‌

ARI

Fleet

Lease

Trust

Series

2020-A,

Class

B

2.06%,

11/15/28  (1)

270‌

269‌

Avis

Budget

Rental

Car

Funding

AESOP

Series

2017-2A,

Class

D

4.56%,

3/20/24  (1)

5,000‌

4,977‌

Avis

Budget

Rental

Car

Funding

AESOP

Series

2018-1A,

Class

D

5.25%,

9/20/24  (1)

6,530‌

6,396‌

Carvana

Auto

Receivables

Trust

Series

2021-N4,

Class

B

1.24%,

9/11/28 

7,686‌

7,392‌

Chase

Auto

Credit

Linked

Notes

Series

2020-1,

Class

B

0.991%,

1/25/28  (1)

799‌

785‌

Chase

Auto

Credit

Linked

Notes

Series

2020-2,

Class

B

0.84%,

2/25/28  (1)

1,732‌

1,685‌

Chase

Auto

Credit

Linked

Notes

Series

2021-2,

Class

B

0.889%,

12/26/28  (1)

10,655‌

10,220‌

Chase

Auto

Credit

Linked

Notes

Series

2021-3,

Class

B

0.76%,

2/26/29  (1)

8,991‌

8,443‌

Exeter

Automobile

Receivables

Trust

Series

2021-2A,

Class

B

0.57%,

9/15/25 

8,451‌

8,373‌

Exeter

Automobile

Receivables

Trust

Series

2022-3A,

Class

B

4.86%,

12/15/26 

5,400‌

5,296‌

Exeter

Automobile

Receivables

Trust

Series

2022-64,

Class

A3

5.70%,

8/17/26 

1,550‌

1,550‌

Ford

Credit

Auto

Lease

Trust

Series

2020-B,

Class

B

1.00%,

11/15/23 

331‌

330‌

Ford

Credit

Auto

Lease

Trust

Series

2021-A,

Class

B

0.47%,

5/15/24 

17,400‌

17,001‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

19

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

20

Par/Shares

$

Value

(Amounts

in

000s)

Ford

Credit

Floorplan

Master

Owner

Trust

Series

2020-1,

Class

B

0.98%,

9/15/25 

5,195‌

4,977‌

GM

Financial

Automobile

Leasing

Trust

Series

2020-2,

Class

B

1.56%,

7/22/24 

2,130‌

2,124‌

GM

Financial

Automobile

Leasing

Trust

Series

2020-3,

Class

B

0.76%,

10/21/24 

2,215‌

2,188‌

GM

Financial

Automobile

Leasing

Trust

Series

2022-2,

Class

B

4.02%,

5/20/26 

6,700‌

6,518‌

GMF

Floorplan

Owner

Revolving

Trust

Series

2020-1,

Class

B

1.03%,

8/15/25  (1)

1,435‌

1,382‌

GMF

Floorplan

Owner

Revolving

Trust

Series

2020-2,

Class

B

0.96%,

10/15/25  (1)

2,145‌

2,049‌

Hyundai

Auto

Lease

Securitization

Trust

Series

2020-B,

Class

B

0.81%,

10/15/24  (1)

1,930‌

1,904‌

Hyundai

Auto

Lease

Securitization

Trust

Series

2021-A,

Class

B

0.61%,

10/15/25  (1)

8,700‌

8,442‌

Hyundai

Auto

Lease

Securitization

Trust

Series

2021-B,

Class

B

0.62%,

3/16/26  (1)

20,345‌

19,237‌

Hyundai

Auto

Lease

Securitization

Trust

Series

2022-C,

Class

A4

4.48%,

8/17/26  (1)

7,035‌

6,939‌

JPMorgan

Chase

Bank

-

CACLN

Series

2021-1,

Class

B

0.875%,

9/25/28  (1)

947‌

912‌

Santander

Consumer

Auto

Receivables

Trust

Series

2021-BA,

Class

B

1.45%,

10/16/28  (1)

1,013‌

993‌

Santander

Consumer

Auto

Receivables

Trust

Series

2021-CA,

Class

B

1.44%,

4/17/28  (1)

24‌

24‌

Santander

Drive

Auto

Receivables

Trust

Series

2020-3,

Class

C

1.12%,

1/15/26 

1,455‌

1,439‌

Santander

Drive

Auto

Receivables

Trust

Series

2022-6,

Class

B

4.72%,

6/15/27 

10,350‌

10,050‌

Santander

Drive

Auto

Receivables

Trust

Series

2022-7,

Class

A2

5.81%,

1/15/26 

4,165‌

4,161‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

21

Par/Shares

$

Value

(Amounts

in

000s)

Santander

Retail

Auto

Lease

Trust

Series

2020-B,

Class

B

0.82%,

12/20/24  (1)

11,555‌

10,943‌

Santander

Retail

Auto

Lease

Trust

Series

2021-B,

Class

B

0.84%,

6/20/25  (1)

13,860‌

12,971‌

Santander

Retail

Auto

Lease

Trust

Series

2021-C,

Class

B

0.83%,

3/20/26  (1)

10,135‌

9,482‌

World

Omni

Automobile

Lease

Securitization

Trust

Series

2020-B,

Class

B

0.70%,

2/17/26 

7,250‌

7,056‌

World

Omni

Select

Auto

Trust

Series

2020-A,

Class

B

0.84%,

6/15/26 

5,585‌

5,379‌

199,882‌

Collateralized

Debt

Obligation

0.5%

Barings

Series

2013-IA,

Class

AR,

CLO,

FRN

3M

USD

LIBOR

+

0.80%,

5.043%,

1/20/28  (1)

662‌

655‌

Magnetite

XVI

Series

2015-16A,

Class

AR,

CLO,

FRN

3M

USD

LIBOR

+

0.80%,

4.994%,

1/18/28  (1)

729‌

722‌

Symphony

Static

I

Series

2021-1A,

Class

A,

CLO,

FRN

3M

USD

LIBOR

+

0.83%,

5.188%,

10/25/29  (1)

14,442‌

14,217‌

15,594‌

Home

Equity

Loans

Backed

0.2%

Citigroup

Mortgage

Loan

Trust

Series

2020-EXP2,

Class

A3,

CMO,

ARM

2.50%,

8/25/50  (1)

6,732‌

5,501‌

Citigroup

Mortgage

Loan

Trust

Series

2020-EXP2,

Class

A4,

CMO,

ARM

2.50%,

8/25/50  (1)

1,627‌

1,328‌

6,829‌

Other

Asset-Backed

Securities

2.6%

ARI

Fleet

Lease

Trust

Series

2021-A,

Class

A2

0.37%,

3/15/30  (1)

5,197‌

5,092‌

Elara

HGV

Timeshare

Issuer

Series

2016-A,

Class

A

2.73%,

4/25/28  (1)

596‌

587‌

Elara

HGV

Timeshare

Issuer

Series

2017-A,

Class

A

2.69%,

3/25/30  (1)

3,255‌

3,115‌

Hilton

Grand

Vacations

Trust

Series

2017-AA,

Class

A

2.66%,

12/26/28  (1)

40‌

40‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

22

Par/Shares

$

Value

(Amounts

in

000s)

Hilton

Grand

Vacations

Trust

Series

2019-AA,

Class

A

2.34%,

7/25/33  (1)

652‌

608‌

HPEFS

Equipment

Trust

Series

2021-2A,

Class

B

0.61%,

9/20/28  (1)

5,250‌

5,014‌

MVW

Series

2020-1A,

Class

A

1.74%,

10/20/37  (1)

66‌

60‌

MVW

Series

2021-1WA,

Class

A

1.14%,

1/22/41  (1)

3,830‌

3,501‌

Navient

Private

Education

Refi

Loan

Trust

Series

2021-CA,

Class

A

1.06%,

10/15/69  (1)

13,118‌

11,329‌

Nelnet

Student

Loan

Trust

Series

2021-DA,

Class

AFL,

FRN

1M

USD

LIBOR

+

0.69%,

4.629%,

4/20/62  (1)

4,856‌

4,694‌

Octane

Receivables

Trust

Series

2021-1A,

Class

A

0.93%,

3/22/27  (1)

7,514‌

7,241‌

Octane

Receivables

Trust

Series

2021-2A,

Class

A

1.21%,

9/20/28  (1)

6,472‌

6,166‌

Octane

Receivables

Trust

Series

2022-1A,

Class

A2

4.18%,

3/20/28  (1)

5,447‌

5,315‌

Santander

Bank

Series

2021-1A,

Class

B

1.833%,

12/15/31  (1)

2,904‌

2,786‌

Santander

Bank

Auto

Credit-Linked

Notes

Series

2022-A,

Class

B

5.281%,

5/15/32  (1)

11,138‌

10,855‌

Santander

Bank

Auto

Credit-Linked

Notes

Series

2022-B,

Class

B

5.721%,

8/16/32  (1)

4,273‌

4,250‌

Sierra

Timeshare

Receivables

Funding

Series

2019-3A,

Class

A

2.34%,

8/20/36  (1)

3,214‌

3,014‌

Sierra

Timeshare

Receivables

Funding

Series

2020-2A,

Class

A

1.33%,

7/20/37  (1)

194‌

182‌

73,849‌

Student

Loans

1.7%

Navient

Private

Education

Loan

Trust

Series

2016-AA,

Class

A2A

3.91%,

12/15/45  (1)

9,217‌

8,904‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

23

Par/Shares

$

Value

(Amounts

in

000s)

Navient

Private

Education

Loan

Trust

Series

2017-A,

Class

A2B,

FRN

1M

USD

LIBOR

+

0.90%,

4.773%,

12/16/58  (1)

349‌

348‌

Navient

Private

Education

Refi

Loan

Trust

Series

2020-DA,

Class

A

1.69%,

5/15/69  (1)

665‌

595‌

Navient

Private

Education

Refi

Loan

Trust

Series

2020-FA,

Class

A

1.22%,

7/15/69  (1)

2,730‌

2,419‌

Navient

Private

Education

Refi

Loan

Trust

Series

2020-IA,

Class

A1A

1.33%,

4/15/69  (1)

3,023‌

2,572‌

Navient

Private

Education

Refi

Loan

Trust

Series

2021-A,

Class

A

0.84%,

5/15/69  (1)

1,232‌

1,052‌

Navient

Private

Education

Refi

Loan

Trust

Series

2021-BA,

Class

A

0.94%,

7/15/69  (1)

5,985‌

5,052‌

Navient

Private

Education

Refi

Loan

Trust

Series

2021-EA,

Class

A

0.97%,

12/16/69  (1)

9,352‌

7,726‌

Navient

Private

Education

Refi

Loan

Trust

Series

2021-FA,

Class

A

1.11%,

2/18/70  (1)

3,733‌

3,058‌

Navient

Private

Education

Refi

Loan

Trust

Series

2021-GA,

Class

A

1.58%,

4/15/70  (1)

11,939‌

10,068‌

Navient

Private

Education

Refi

Loan

Trust

Series

2022-A,

Class

A

2.23%,

7/15/70  (1)

3,190‌

2,775‌

SMB

Private

Education

Loan

Trust

Series

2014-A,

Class

A3,

FRN

1M

USD

LIBOR

+

1.50%,

5.375%,

4/15/32  (1)

1,373‌

1,370‌

SMB

Private

Education

Loan

Trust

Series

2019-A,

Class

A2A

3.44%,

7/15/36  (1)

2,022‌

1,922‌

47,861‌

Total

Asset-Backed

Securities

(Cost

$365,017)

344,015‌

CORPORATE

BONDS

61.7%

Advertising

0.6%

WPP

Finance

2010,

3.75%,

9/19/24 

18,350‌

17,721‌

17,721‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

24

Par/Shares

$

Value

(Amounts

in

000s)

Airlines

0.5%

SMBC

Aviation

Capital

Finance,

4.125%,

7/15/23  (1)

13,698‌

13,507‌

13,507‌

Automotive

3.6%

BMW

U.S.

Capital,

FRN,

SOFRINDX

+

0.53%,

4.051%,

4/1/24  (1)

10,000‌

9,936‌

Daimler

Trucks

Finance

North

America,

FRN,

SOFR

+

0.75%,

4.054%,

12/13/24  (1)

12,843‌

12,660‌

Daimler

Trucks

Finance

North

America,

FRN,

SOFR

+

1.00%,

4.561%,

4/5/24  (1)

10,000‌

9,943‌

Hyundai

Capital

America,

0.80%,

1/8/24  (1)

1,000‌

947‌

Hyundai

Capital

America,

1.00%,

9/17/24  (1)

19,874‌

18,258‌

Mercedes-Benz

Finance

North

America,

5.50%,

11/27/24  (1)

5,850‌

5,887‌

Nissan

Motor,

3.043%,

9/15/23  (1)

17,346‌

16,934‌

Nissan

Motor

Acceptance,

3.45%,

3/15/23  (1)

5,528‌

5,494‌

Nissan

Motor

Acceptance,

3.875%,

9/21/23  (1)

5,000‌

4,887‌

Stellantis,

5.25%,

4/15/23 

20,110‌

19,984‌

104,930‌

Banking

21.2%

AIB

Group,

4.75%,

10/12/23  (1)

21,035‌

20,753‌

Banco

Santander,

5.147%,

8/18/25 

4,800‌

4,756‌

Banco

Santander,

FRN,

SOFR

+

1.24%,

5.067%,

5/24/24 

5,000‌

4,979‌

Bank

of

America,

FRN,

SOFR

+

0.69%,

4.428%,

4/22/25 

15,000‌

14,737‌

Bank

of

Ireland

Group,

4.50%,

11/25/23  (1)

27,452‌

26,873‌

Bank

of

Montreal,

FRN,

SOFRINDX

+

0.32%,

3.904%,

7/9/24 

10,000‌

9,850‌

Bank

of

Montreal,

Series

H,

4.25%,

9/14/24 

2,945‌

2,909‌

Bank

of

Nova

Scotia,

FRN,

SOFRINDX

+

0.445%,

4.088%,

4/15/24 

17,145‌

16,952‌

Bank

of

Nova

Scotia,

FRN,

SOFRINDX

+

0.55%,

3.854%,

9/15/23 

12,544‌

12,506‌

Barclays,

4.375%,

9/11/24 

11,420‌

11,113‌

Barclays,

VR,

4.338%,

5/16/24  (2)

5,000‌

4,950‌

Barclays,

VR,

5.304%,

8/9/26  (2)

8,300‌

8,119‌

BDO

Unibank,

2.95%,

3/6/23 

11,650‌

11,557‌

BPCE,

5.70%,

10/22/23  (1)

34,423‌

33,806‌

Canadian

Imperial

Bank

of

Commerce,

FRN,

SOFRINDX

+

0.40%,

3.687%,

12/14/23 

6,257‌

6,218‌

Capital

One

Financial,

FRN,

SOFR

+

1.35%,

5.175%,

5/9/25 

10,000‌

9,840‌

Capital

One

Financial,

VR,

2.636%,

3/3/26  (2)

7,060‌

6,605‌

Citigroup,

FRN,

SOFR

+

0.669%,

4.476%,

5/1/25 

15,000‌

14,714‌

Credit

Suisse,

Series

FRN,

FRN,

SOFRINDX

+

1.26%,

5.086%,

2/21/25 

4,000‌

3,734‌

Credit

Suisse

Group,

VR,

2.997%,

12/14/23  (1)(2)

14,030‌

13,878‌

Credit

Suisse

Group,

VR,

4.207%,

6/12/24  (1)(2)

10,000‌

9,715‌

Danske

Bank,

3.875%,

9/12/23  (1)

7,695‌

7,579‌

Danske

Bank,

5.375%,

1/12/24  (1)

2,916‌

2,890‌

Danske

Bank,

VR,

1.171%,

12/8/23  (1)(2)

7,225‌

7,219‌

Danske

Bank,

VR,

3.773%,

3/28/25  (1)(2)

6,675‌

6,409‌

Deutsche

Bank,

Series

E,

FRN,

SOFR

+

0.50%,

4.324%,

11/8/23 

20,000‌

19,738‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

25

Par/Shares

$

Value

(Amounts

in

000s)

Goldman

Sachs

Group,

FRN,

SOFR

+

0.50%,

3.719%,

9/10/24 

10,000‌

9,819‌

Goldman

Sachs

Group,

FRN,

SOFR

+

0.58%,

3.765%,

3/8/24 

10,000‌

9,890‌

Goldman

Sachs

Group,

FRN,

SOFR

+

0.70%,

4.405%,

1/24/25 

9,950‌

9,764‌

Goldman

Sachs

Group,

FRN,

SOFR

+

1.39%,

4.694%,

3/15/24 

5,000‌

4,992‌

HSBC

Holdings,

4.25%,

3/14/24 

20,041‌

19,658‌

HSBC

Holdings,

FRN,

SOFR

+

0.58%,

4.406%,

11/22/24 

10,000‌

9,744‌

ING

Bank,

5.80%,

9/25/23 

3,307‌

3,293‌

Intesa

Sanpaolo,

3.375%,

1/12/23  (1)

15,000‌

14,947‌

Intesa

Sanpaolo,

5.25%,

1/12/24 

9,510‌

9,367‌

JPMorgan

Chase,

FRN,

SOFR

+

0.535%,

4.363%,

6/1/25 

10,000‌

9,810‌

JPMorgan

Chase,

Series

FRN,

FRN,

SOFR

+

0.58%,

4.02%,

6/23/25 

10,000‌

9,782‌

KEB

Hana

Bank,

4.625%,

10/24/23 

12,500‌

12,376‌

Mitsubishi

UFJ

Financial

Group,

VR,

5.063%,

9/12/25  (2)

17,165‌

17,014‌

Morgan

Stanley,

FRN,

SOFR

+

0.95%,

4.777%,

2/18/26 

14,925‌

14,620‌

Morgan

Stanley,

FRN,

SOFR

+

1.165%,

4.844%,

4/17/25 

10,000‌

9,910‌

Nationwide

Building

Society,

VR,

3.766%,

3/8/24  (1)(2)

10,029‌

9,960‌

NatWest

Group,

VR,

2.359%,

5/22/24  (2)

5,000‌

4,902‌

NatWest

Markets,

FRN,

SOFR

+

0.53%,

4.355%,

8/12/24  (1)

6,315‌

6,181‌

NatWest

Markets,

FRN,

SOFR

+

1.45%,

4.873%,

3/22/25  (1)

2,483‌

2,465‌

Santander

U.K.,

5.00%,

11/7/23  (1)

5,000‌

4,921‌

Santander

U.K.

Group

Holdings,

VR,

1.089%,

3/15/25  (2)

10,510‌

9,756‌

Societe

Generale,

5.00%,

1/17/24  (1)

7,815‌

7,699‌

Societe

Generale,

FRN,

SOFR

+

1.05%,

4.746%,

1/21/26  (1)

10,000‌

9,559‌

Standard

Chartered,

3.95%,

1/11/23  (1)

23,807‌

23,684‌

Standard

Chartered,

5.20%,

1/26/24  (1)

2,157‌

2,129‌

Standard

Chartered,

FRN,

SOFR

+

0.93%,

4.757%,

11/23/25  (1)

5,000‌

4,820‌

State

Bank

of

India,

4.50%,

9/28/23 

13,300‌

13,194‌

Toronto-Dominion

Bank,

FRN,

SOFR

+

0.22%,

4.048%,

6/2/23 

10,000‌

9,963‌

Toronto-Dominion

Bank,

FRN,

SOFR

+

0.35%,

3.569%,

9/10/24 

10,000‌

9,812‌

Truist

Financial,

FRN,

SOFR

+

0.40%,

3.602%,

6/9/25 

20,000‌

19,515‌

UBS,

FRN,

SOFR

+

0.36%,

4.184%,

2/9/24  (1)

10,000‌

9,928‌

Wells

Fargo,

FRN,

SOFR

+

1.32%,

5.036%,

4/25/26 

9,900‌

9,813‌

615,686‌

Cable

Operators

0.7%

Charter

Communications

Operating,

4.908%,

7/23/25 

12,940‌

12,745‌

Cox

Communications,

3.15%,

8/15/24  (1)

7,900‌

7,588‌

20,333‌

Chemicals

1.6%

Celanese

U.S.

Holdings,

5.90%,

7/5/24 

20,000‌

19,853‌

Cytec

Industries,

3.50%,

4/1/23 

23,569‌

23,550‌

International

Flavors

&

Fragrances,

3.20%,

5/1/23 

4,303‌

4,265‌

47,668‌

Computer

Service

&

Software

0.1%

Oracle,

5.80%,

11/10/25 

2,945‌

3,012‌

3,012‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

26

Par/Shares

$

Value

(Amounts

in

000s)

Drugs

0.2%

Perrigo

Finance

Unlimited,

3.90%,

12/15/24 

3,364‌

3,171‌

Viatris,

1.65%,

6/22/25 

4,360‌

3,945‌

7,116‌

Energy

5.4%

Cheniere

Corpus

Christi

Holdings,

5.875%,

3/31/25 

12,218‌

12,293‌

Cheniere

Corpus

Christi

Holdings,

7.00%,

6/30/24 

5,500‌

5,563‌

Continental

Resources,

4.50%,

4/15/23 

5,825‌

5,803‌

DCP

Midstream

Operating,

5.375%,

7/15/25 

15,925‌

15,694‌

Devon

Energy,

8.25%,

8/1/23 

35,159‌

35,773‌

Ecopetrol,

5.875%,

9/18/23 

7,900‌

7,855‌

Energy

Transfer

Partners,

4.50%,

11/1/23 

4,209‌

4,162‌

Gray

Oak

Pipeline,

2.00%,

9/15/23  (1)

24,536‌

23,815‌

Kinder

Morgan,

5.625%,

11/15/23  (1)

6,186‌

6,190‌

Plains

All

American

Pipeline,

2.85%,

1/31/23 

13,361‌

13,302‌

Plains

All

American

Pipeline,

3.85%,

10/15/23 

9,815‌

9,667‌

Sabine

Pass

Liquefaction,

5.625%,

4/15/23 

16,339‌

16,333‌

156,450‌

Financial

3.7%

AerCap

Ireland

Capital,

1.65%,

10/29/24 

7,230‌

6,659‌

AerCap

Ireland

Capital,

4.125%,

7/3/23 

22,810‌

22,586‌

AerCap

Ireland

Capital,

4.50%,

9/15/23 

2,075‌

2,048‌

AerCap

Ireland

Capital,

4.875%,

1/16/24 

2,000‌

1,969‌

AerCap

Ireland

Capital,

FRN,

SOFR

+

0.68%,

4.183%,

9/29/23 

6,835‌

6,690‌

Ally

Financial,

1.45%,

10/2/23 

8,500‌

8,206‌

Ally

Financial,

4.625%,

3/30/25 

1,475‌

1,450‌

Ally

Financial,

5.125%,

9/30/24 

6,400‌

6,328‌

CNO

Financial

Group,

5.25%,

5/30/25 

2,000‌

1,977‌

General

Motors

Financial,

4.15%,

6/19/23 

1,390‌

1,381‌

General

Motors

Financial,

FRN,

SOFR

+

0.62%,

4.263%,

10/15/24 

15,000‌

14,616‌

General

Motors

Financial,

FRN,

SOFR

+

0.76%,

3.945%,

3/8/24 

20,000‌

19,646‌

Indian

Railway

Finance,

3.73%,

3/29/24 

8,000‌

7,819‌

Western

Union,

2.85%,

1/10/25 

2,408‌

2,286‌

Western

Union,

4.25%,

6/9/23 

3,050‌

3,028‌

106,689‌

Food/Tobacco

1.7%

BAT

Capital,

2.789%,

9/6/24 

10,731‌

10,251‌

BAT

Capital,

3.222%,

8/15/24 

1,800‌

1,736‌

Imperial

Brands

Finance,

3.125%,

7/26/24  (1)

4,200‌

4,004‌

Imperial

Brands

Finance,

3.50%,

2/11/23  (1)

17,510‌

17,380‌

Imperial

Brands

Finance,

4.25%,

7/21/25  (1)

4,935‌

4,712‌

Philip

Morris

International,

5.125%,

11/15/24 

10,885‌

10,885‌

48,968‌

Forest

Products

0.3%

Celulosa

Arauco

y

Constitucion,

4.50%,

8/1/24 

10,000‌

9,837‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

27

Par/Shares

$

Value

(Amounts

in

000s)

9,837‌

Gas

&

Gas

Transmission

0.2%

Kinder

Morgan

Energy

Partners,

3.45%,

2/15/23 

5,000‌

4,982‌

4,982‌

Health

Care

2.3%

HCA,

5.00%,

3/15/24 

9,900‌

9,839‌

HCA,

5.375%,

2/1/25 

5,950‌

5,908‌

Humana,

0.65%,

8/3/23 

20,255‌

19,656‌

Mylan,

3.125%,

1/15/23  (1)

11,246‌

11,200‌

Mylan,

4.20%,

11/29/23 

8,761‌

8,660‌

Stryker,

0.60%,

12/1/23 

3,370‌

3,218‌

Thermo

Fisher

Scientific,

FRN,

SOFR

+

0.53%,

4.182%,

10/18/24 

8,250‌

8,174‌

66,655‌

Information

Technology

1.4%

Analog

Devices,

FRN,

SOFR

+

0.25%,

3.771%,

10/1/24 

3,225‌

3,179‌

Baidu,

3.875%,

9/29/23 

1,000‌

989‌

Equifax,

3.95%,

6/15/23 

4,000‌

3,974‌

Marvell

Technology,

4.20%,

6/22/23 

7,624‌

7,538‌

Microchip

Technology,

0.972%,

2/15/24 

7,600‌

7,190‌

Microchip

Technology,

2.67%,

9/1/23 

4,595‌

4,495‌

Microchip

Technology,

4.333%,

6/1/23 

9,764‌

9,714‌

Skyworks

Solutions,

0.90%,

6/1/23 

3,075‌

3,004‌

40,083‌

Insurance

2.1%

Athene

Global

Funding,

1.20%,

10/13/23  (1)

4,040‌

3,876‌

Athene

Global

Funding,

2.50%,

1/14/25  (1)

4,103‌

3,840‌

Athene

Global

Funding,

2.514%,

3/8/24  (1)

5,000‌

4,773‌

Athene

Global

Funding,

FRN,

SOFR

+

0.70%,

4.527%,

5/24/24  (1)

5,000‌

4,911‌

Athene

Global

Funding,

FRN,

SOFR

+

0.715%,

4.294%,

1/7/25  (1)

9,850‌

9,570‌

Brighthouse

Financial

Global

Funding,

1.00%,

4/12/24  (1)

970‌

908‌

Brighthouse

Financial

Global

Funding,

FRN,

SOFR

+

0.76%,

4.363%,

4/12/24  (1)

18,003‌

17,811‌

Corebridge

Financial,

3.50%,

4/4/25  (1)

7,250‌

6,941‌

Liberty

Mutual

Group,

4.25%,

6/15/23  (1)

2,504‌

2,482‌

Principal

Life

Global

Funding

II,

FRN,

SOFR

+

0.45%,

4.053%,

4/12/24  (1)

4,800‌

4,761‌

Trinity

Acquisition,

4.625%,

8/15/23 

2,202‌

1,982‌

61,855‌

Investment

Dealers

0.3%

Charles

Schwab,

FRN,

SOFRINDX

+

0.50%,

3.838%,

3/18/24 

10,000‌

9,937‌

9,937‌

Lodging

0.8%

Hyatt

Hotels,

1.30%,

10/1/23 

6,255‌

6,050‌

Marriott

International,

3.125%,

2/15/23 

9,128‌

9,091‌

Marriott

International,

Series

Z,

4.15%,

12/1/23 

7,050‌

6,977‌

22,118‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

28

Par/Shares

$

Value

(Amounts

in

000s)

Manufacturing

0.3%

Siemens

Financieringsmaatschappij,

FRN,

SOFR

+

0.43%,

3.649%,

3/11/24  (1)

10,000‌

9,974‌

9,974‌

Media

&

Communications

1.8%

Magallanes,

3.428%,

3/15/24  (1)

4,965‌

4,815‌

Magallanes,

3.638%,

3/15/25  (1)

10,805‌

10,304‌

Magallanes,

FRN,

SOFRINDX

+

1.78%,

5.084%,

3/15/24  (1)

9,925‌

9,878‌

PCCW-HKT

Capital

No

5,

3.75%,

3/8/23 

6,931‌

6,905‌

SES,

3.60%,

4/4/23  (1)

20,064‌

19,788‌

51,690‌

Metals

&

Mining

0.7%

ABJA

Investment,

4.45%,

7/24/23 

11,300‌

11,204‌

POSCO

Holdings,

2.375%,

1/17/23 

4,000‌

3,985‌

POSCO

Holdings,

4.00%,

8/1/23 

5,225‌

5,182‌

20,371‌

Oil

Field

Services

0.8%

Energy

Transfer,

3.60%,

2/1/23 

5,275‌

5,257‌

Energy

Transfer,

4.25%,

3/15/23 

2,000‌

1,993‌

Energy

Transfer,

4.90%,

2/1/24 

4,265‌

4,232‌

Energy

Transfer,

5.875%,

1/15/24 

6,578‌

6,584‌

Energy

Transfer,

Series

5Y,

4.20%,

9/15/23 

6,570‌

6,507‌

24,573‌

Other

Telecommunications

0.4%

British

Telecommunications,

4.50%,

12/4/23 

11,134‌

11,023‌

11,023‌

Petroleum

0.8%

Aker

BP,

3.00%,

1/15/25  (1)

9,072‌

8,573‌

Enbridge,

FRN,

SOFRINDX

+

0.63%,

4.456%,

2/16/24 

14,625‌

14,505‌

23,078‌

Railroads

0.3%

Eastern

Creation

II

Investment

Holdings,

1.00%,

9/10/23 

7,970‌

7,715‌

7,715‌

Real

Estate

Investment

Trust

Securities

0.3%

Essex

Portfolio,

3.25%,

5/1/23 

1,541‌

1,532‌

Public

Storage,

FRN,

SOFR

+

0.47%,

4.173%,

4/23/24 

6,305‌

6,252‌

Realty

Income,

4.60%,

2/6/24 

1,636‌

1,621‌

9,405‌

Retail

0.9%

7-Eleven,

0.625%,

2/10/23  (1)

2,440‌

2,418‌

Nordstrom,

2.30%,

4/8/24 

9,395‌

8,761‌

QVC,

4.85%,

4/1/24 

16,245‌

15,270‌

26,449‌

Services

0.2%

CDW,

5.50%,

12/1/24 

3,675‌

3,638‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

29

Par/Shares

$

Value

(Amounts

in

000s)

Nature

Conservancy,

Series

A,

0.467%,

7/1/23 

850‌

829‌

Nature

Conservancy,

Series

A,

0.625%,

7/1/24 

650‌

607‌

5,074‌

Telephones

0.8%

AT&T,

FRN,

SOFRINDX

+

0.64%,

4.097%,

3/25/24 

13,328‌

13,223‌

Ooredoo

International

Finance,

3.25%,

2/21/23 

9,500‌

9,467‌

22,690‌

Transportation

0.5%

Penske

Truck

Leasing,

4.125%,

8/1/23  (1)

4,282‌

4,236‌

Triton

Container

International,

0.80%,

8/1/23  (1)

9,230‌

8,893‌

13,129‌

Transportation

(Excluding

Railroads)

1.2%

Sydney

Airport

Finance,

3.90%,

3/22/23  (1)

35,651‌

35,487‌

35,487‌

Transportation

Services

0.2%

HPHT

Finance,

2.875%,

11/5/24  (3)

5,190‌

4,949‌

4,949‌

Utilities

4.6%

Alexander

Funding

Trust,

1.841%,

11/15/23  (1)

10,990‌

10,361‌

Edison

International,

2.95%,

3/15/23 

5,000‌

4,944‌

Hero

Asia

Investment,

1.50%,

11/18/23  (3)

12,800‌

12,336‌

NextEra

Energy

Capital

Holdings,

FRN,

SOFR

+

0.40%,

4.207%,

11/3/23 

39,800‌

39,363‌

NRG

Energy,

3.75%,

6/15/24  (1)

670‌

646‌

Pacific

Gas

&

Electric,

3.25%,

6/15/23 

5,000‌

4,932‌

Pacific

Gas

&

Electric,

4.25%,

8/1/23 

2,500‌

2,468‌

Pacific

Gas

&

Electric,

4.95%,

6/8/25 

9,900‌

9,716‌

Saudi

Electricity

Global

Sukuk,

3.473%,

4/8/23 

6,000‌

5,966‌

Southern,

STEP,

4.475%,

8/1/24 

8,315‌

8,180‌

Southern

California

Edison,

FRN,

SOFR

+

0.83%,

4.351%,

4/1/24 

2,475‌

2,453‌

Southern

California

Edison,

Series

D,

3.40%,

6/1/23 

2,350‌

2,327‌

State

Grid

Overseas

Investment,

3.75%,

5/2/23 

4,714‌

4,696‌

Vistra

Operations,

3.55%,

7/15/24  (1)

24,655‌

23,545‌

131,933‌

Wireless

Communications

1.2%

American

Tower,

2.95%,

1/15/25 

5,279‌

5,040‌

SBA

Tower

Trust,

3.448%,

3/15/23  (1)

15,000‌

14,928‌

Sprint,

7.125%,

6/15/24 

14,750‌

15,063‌

35,031‌

Total

Corporate

Bonds

(Cost

$1,831,226)

1,790,118‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

30

Par/Shares

$

Value

(Amounts

in

000s)

FOREIGN

GOVERNMENT

OBLIGATIONS

&

MUNICIPALITIES

0.9%

Energy

0.4%

Korea

National

Oil,

1.75%,

4/18/25 

10,500‌

9,654‌

Foreign

Govt

&

Muni

(Excl

Canadian)

0.5%

Japan

Treasury

Discount

Bill,

(0.14)%,

2/13/23

(JPY) 

1,045,950‌

7,576‌

Japan

Treasury

Discount

Bill,

(0.13)%,

2/6/23

(JPY) 

1,057,200‌

7,658‌

15,234‌

Total

Foreign

Government

Obligations

&

Municipalities

(Cost

$24,622)

24,888‌

MUNICIPAL

SECURITIES

0.7%

California

0.1%

California

Municipal

Fin.

Auth.,

National

Univ.,

Series

B,

3.323%,

4/1/23 

1,030‌

1,024‌

Port

of

Oakland,

Senior

Lien,

Series

R,

0.821%,

5/1/23 

1,040‌

1,023‌

2,047‌

Illinois

0.0%

Chicago

Transit

Auth.

Sales

Tax

Receipts

Fund,

Series

B,

1.708%,

12/1/22 

680‌

680‌

Chicago

Transit

Auth.

Sales

Tax

Receipts

Fund,

Series

B,

1.838%,

12/1/23 

870‌

844‌

1,524‌

Iowa

0.0%

Iowa

Tobacco

Settlement

Auth.,

Series

A-1,

0.663%,

6/1/23 

1,500‌

1,466‌

1,466‌

Michigan

0.1%

Great

Lakes

Water

Auth.

Sewage

Disposal

System

Revenue,

Series

A,

1.503%,

7/1/23 

250‌

245‌

Michigan

Fin.

Auth.,

Series

A-1,

1.086%,

6/1/23 

2,125‌

2,075‌

2,320‌

New

Jersey

0.0%

New

Jersey

Turnpike

Auth.,

Series

B,

0.473%,

1/1/23 

150‌

149‌

149‌

Oregon

0.1%

Medford

Hosp.

Fac.

Auth.,

Asante

Project,

Series

B,

1.73%,

8/15/23 

1,710‌

1,674‌

1,674‌

South

Dakota

0.1%

Educational

Enhancement

Funding,

0.706%,

6/1/23 

2,700‌

2,645‌

2,645‌

Texas

0.1%

Central

Texas

Regional

Mobility

Auth.,

Senior

Lien,

Series

C,

1.345%,

1/1/24 

500‌

481‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

31

Par/Shares

$

Value

(Amounts

in

000s)

Central

Texas

Regional

Mobility

Auth.,

Subordinate,

Series

D,

1.486%,

1/1/23 

170‌

170‌

Central

Texas

Regional

Mobility

Auth.,

Subordinate,

Series

D,

1.645%,

1/1/24 

510‌

490‌

Dallas/Fort

Worth

Int'l.

Airport,

Series

C,

1.041%,

11/1/23 

500‌

483‌

Tarrant

County

Cultural

Ed.

Fac.

Fin.,

Hendrick

Medical

Center,

1.071%,

9/1/23  (4)

475‌

462‌

2,086‌

West

Virginia

0.2%

Tobacco

Settlement

Fin.

Auth.,

Class

1

Senior

Bonds,

Series

A,

1.193%,

6/1/23 

5,415‌

5,295‌

5,295‌

Total

Municipal

Securities

(Cost

$19,643)

19,206‌

NON-U.S.

GOVERNMENT

MORTGAGE-BACKED

SECURITIES

10.4%

Commercial

Mortgage-Backed

Securities

2.6%

BX

Commercial

Mortgage

Trust

Series

2019-XL,

Class

A,

ARM

1M

TSFR

+

1.034%,

4.829%,

10/15/36  (1)

1,462‌

1,436‌

BX

Commercial

Mortgage

Trust

Series

2020-VKNG,

Class

A,

ARM

1M

USD

LIBOR

+

0.93%,

4.805%,

10/15/37  (1)

4,514‌

4,367‌

BX

Commercial

Mortgage

Trust

Series

2021-SOAR,

Class

A,

ARM

1M

USD

LIBOR

+

0.67%,

4.546%,

6/15/38  (1)

4,962‌

4,751‌

BX

Trust

Series

2021-ARIA,

Class

A,

ARM

1M

USD

LIBOR

+

0.899%,

4.774%,

10/15/36  (1)

3,100‌

2,910‌

GCT

Commercial

Mortgage

Trust

Series

2021-GCT,

Class

A,

ARM

1M

USD

LIBOR

+

0.80%,

4.675%,

2/15/38  (1)

3,000‌

2,792‌

Goldman

Sachs

Mortgage

Securities

Trust

Series

2021-ROSS,

Class

A,

ARM

1M

USD

LIBOR

+

1.15%,

5.026%,

5/15/26  (1)

6,665‌

6,259‌

Great

Wolf

Trust

Series

2019-WOLF,

Class

A,

ARM

1M

USD

LIBOR

+

1.034%,

4.909%,

12/15/36  (1)

10,000‌

9,648‌

JPMorgan

Chase

Commercial

Mortgage

Securities

Trust

Series

2019-BKWD,

Class

A,

ARM

1M

USD

LIBOR

+

1.25%,

5.125%,

9/15/29  (1)

4,303‌

4,175‌

JPMorgan

Chase

Commercial

Mortgage

Securities

Trust

Series

2019-BKWD,

Class

B,

ARM

1M

USD

LIBOR

+

1.60%,

5.475%,

9/15/29  (1)

7,000‌

6,694‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

32

Par/Shares

$

Value

(Amounts

in

000s)

JPMorgan

Chase

Commercial

Mortgage

Securities

Trust

Series

2020-609M,

Class

A,

ARM

1M

USD

LIBOR

+

1.37%,

5.246%,

10/15/33  (1)

9,870‌

9,424‌

KKR

Industrial

Portfolio

Trust

Series

2021-KDIP,

Class

A,

ARM

1M

USD

LIBOR

+

0.55%,

4.425%,

12/15/37  (1)

2,840‌

2,726‌

MHC

Trust

Series

2021-MHC2,

Class

A,

ARM

1M

USD

LIBOR

+

0.85%,

4.725%,

5/15/38  (1)

12,500‌

12,046‌

ONE

Mortgage

Trust

Series

2021-PARK,

Class

A,

ARM

1M

TSFR

+

0.814%,

4.608%,

3/15/36  (1)

7,110‌

6,773‌

74,001‌

Whole

Loans

Backed

7.8%

Angel

Oak

Mortgage

Trust

Series

2019-5,

Class

A1,

CMO,

ARM

2.593%,

10/25/49  (1)

1,314‌

1,232‌

Angel

Oak

Mortgage

Trust

Series

2021-2,

Class

A1,

CMO,

ARM

0.985%,

4/25/66  (1)

5,309‌

4,381‌

Angel

Oak

Mortgage

Trust

I

Series

2019-1,

Class

A1,

CMO,

ARM

3.92%,

11/25/48  (1)

35‌

34‌

Angel

Oak

Mortgage

Trust

I

Series

2019-1,

Class

A2,

CMO,

ARM

4.022%,

11/25/48  (1)

44‌

44‌

Angel

Oak

Mortgage

Trust

I

Series

2019-1,

Class

A3,

CMO,

ARM

4.124%,

11/25/48  (1)

44‌

44‌

BINOM

Securitization

Trust

Series

2021-INV1,

Class

A1,

CMO,

ARM

2.034%,

6/25/56  (1)

11,368‌

9,816‌

COLT

Mortgage

Loan

Trust

Series

2020-3,

Class

A1,

CMO,

ARM

1.506%,

4/27/65  (1)

1,401‌

1,315‌

Connecticut

Avenue

Securities

Series

2017-C05,

Class

1ED3,

CMO,

ARM

1M

USD

LIBOR

+

1.20%,

5.216%,

1/25/30 

1,393‌

1,391‌

Connecticut

Avenue

Securities

Series

2018-C03,

Class

1EB2,

CMO,

ARM

1M

USD

LIBOR

+

0.85%,

4.866%,

10/25/30 

2,817‌

2,768‌

Connecticut

Avenue

Securities

Series

2018-C03,

Class

1ED2,

CMO,

ARM

1M

USD

LIBOR

+

0.85%,

4.866%,

10/25/30 

1,398‌

1,381‌

Connecticut

Avenue

Securities

Series

2021-R01,

Class

1M1,

CMO,

ARM

SOFR30A

+

0.75%,

4.271%,

10/25/41  (1)

507‌

502‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

33

Par/Shares

$

Value

(Amounts

in

000s)

Deephaven

Residential

Mortgage

Trust

Series

2021-1,

Class

A1,

CMO,

ARM

0.715%,

5/25/65  (1)

5,993‌

5,319‌

Deephaven

Residential

Mortgage

Trust

Series

2021-2,

Class

A1,

CMO,

ARM

0.899%,

4/25/66  (1)

6,056‌

5,036‌

Eagle

RE

Series

2021-2,

Class

M1A,

CMO,

ARM

SOFR30A

+

1.55%,

5.097%,

4/25/34  (1)

7,385‌

7,335‌

Galton

Funding

Mortgage

Trust

Series

2019-2,

Class

A21,

CMO,

ARM

4.00%,

6/25/59  (1)

311‌

292‌

Galton

Funding

Mortgage

Trust

Series

2020-H1,

Class

A2,

CMO,

ARM

2.413%,

1/25/60  (1)

3,407‌

3,048‌

Goldman

Sachs

Mortgage-Backed

Securities

Trust

Series

2020-NQM1,

Class

A1,

CMO,

ARM

1.382%,

9/27/60  (1)

1,168‌

1,060‌

Goldman

Sachs

Mortgage-Backed

Securities

Trust

Series

2021-PJ5,

Class

A6,

CMO,

ARM

2.50%,

10/25/51  (1)

15,471‌

13,517‌

Homeward

Opportunities

Fund

I

Trust

Series

2020-2,

Class

A1,

CMO,

ARM

1.657%,

5/25/65  (1)

205‌

204‌

Imperial

Fund

Mortgage

Trust

Series

2021-NQM2,

Class

A1,

CMO,

ARM

1.073%,

9/25/56  (1)

9,419‌

7,228‌

JPMorgan

Mortgage

Trust

Series

2020-INV2,

Class

A4A,

CMO,

ARM

2.50%,

10/25/50  (1)

259‌

254‌

MFA

Trust

Series

2021-NQM2,

Class

A1,

CMO,

ARM

1.029%,

11/25/64  (1)

7,885‌

6,317‌

NLT

Trust

Series

2021-INV2,

Class

A1,

CMO,

ARM

1.162%,

8/25/56  (1)

17,908‌

14,354‌

OBX

Trust

Series

2018-EXP1,

Class

2A1,

CMO,

ARM

1M

USD

LIBOR

+

0.85%,

4.894%,

4/25/48  (1)

203‌

199‌

OBX

Trust

Series

2019-EXP3,

Class

2A1,

CMO,

ARM

1M

USD

LIBOR

+

0.90%,

4.944%,

10/25/59  (1)

198‌

189‌

OBX

Trust

Series

2020-EXP1,

Class

1A8,

CMO,

ARM

3.50%,

2/25/60  (1)

761‌

672‌

OBX

Trust

Series

2020-EXP3,

Class

1A8,

CMO,

ARM

3.00%,

1/25/60  (1)

4,199‌

3,654‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

34

Par/Shares

$

Value

(Amounts

in

000s)

OBX

Trust

Series

2020-INV1,

Class

A11,

CMO,

ARM

1M

USD

LIBOR

+

0.90%,

4.486%,

12/25/49  (1)

560‌

515‌

OBX

Trust

Series

2021-NQM1,

Class

A1,

CMO,

ARM

1.072%,

2/25/66  (1)

8,575‌

7,399‌

PSMC

Trust

Series

2021-1,

Class

A11,

CMO,

ARM

2.50%,

3/25/51  (1)

11,051‌

9,737‌

PSMC

Trust

Series

2021-2,

Class

A3,

CMO,

ARM

2.50%,

5/25/51  (1)

11,731‌

10,058‌

Sequoia

Mortgage

Trust

Series

2018-CH1,

Class

A1,

CMO,

ARM

4.00%,

3/25/48  (1)

259‌

239‌

SG

Residential

Mortgage

Trust

Series

2019-3,

Class

A1,

CMO,

ARM

2.703%,

9/25/59  (1)

84‌

80‌

SG

Residential

Mortgage

Trust

Series

2021-1,

Class

A1,

CMO,

ARM

1.16%,

7/25/61  (1)

16,199‌

13,175‌

Starwood

Mortgage

Residential

Trust

Series

2020-INV1,

Class

A1,

CMO,

ARM

1.027%,

11/25/55  (1)

3,744‌

3,444‌

Starwood

Mortgage

Residential

Trust

Series

2021-2,

Class

A1,

CMO,

ARM

0.943%,

5/25/65  (1)

2,720‌

2,506‌

Starwood

Mortgage

Residential

Trust

Series

2021-3,

Class

A1,

CMO,

ARM

1.127%,

6/25/56  (1)

12,392‌

9,913‌

Starwood

Mortgage

Residential

Trust

Series

2021-4,

Class

A1,

CMO,

ARM

1.162%,

8/25/56  (1)

19,490‌

15,560‌

Structured

Agency

Credit

Risk

Debt

Notes

Series

2021-DNA3,

Class

M1,

CMO,

ARM

SOFR30A

+

0.75%,

4.271%,

10/25/33  (1)

6,829‌

6,746‌

Structured

Agency

Credit

Risk

Debt

Notes

Series

2021-HQA2,

Class

M1,

CMO,

ARM

SOFR30A

+

0.70%,

4.221%,

12/25/33  (1)

3,020‌

2,990‌

Toorak

Mortgage

Series

2021-INV1,

Class

A1,

CMO,

ARM

1.153%,

7/25/56  (1)

7,361‌

5,976‌

Towd

Point

Mortgage

Trust

Series

2017-1,

Class

A1,

CMO,

ARM

2.75%,

10/25/56  (1)

27‌

26‌

Towd

Point

Mortgage

Trust

Series

2017-3,

Class

A1,

CMO,

ARM

2.75%,

7/25/57  (1)

76‌

74‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

35

Par/Shares

$

Value

(Amounts

in

000s)

Towd

Point

Mortgage

Trust

Series

2017-4,

Class

A1,

CMO,

ARM

2.75%,

6/25/57  (1)

168‌

159‌

Towd

Point

Mortgage

Trust

Series

2017-5,

Class

A1,

CMO,

ARM

1M

USD

LIBOR

+

0.60%,

3.512%,

2/25/57  (1)

151‌

148‌

Towd

Point

Mortgage

Trust

Series

2017-6,

Class

A1,

CMO,

ARM

2.75%,

10/25/57  (1)

359‌

341‌

Towd

Point

Mortgage

Trust

Series

2018-2,

Class

A1,

CMO,

ARM

3.25%,

3/25/58  (1)

567‌

541‌

UWM

Mortgage

Trust

Series

2021-INV2,

Class

A4,

CMO,

ARM

2.50%,

9/25/51  (1)

4,800‌

4,071‌

Verus

Securitization

Trust

Series

2019-4,

Class

A1,

CMO,

STEP

2.642%,

11/25/59  (1)

1,237‌

1,172‌

Verus

Securitization

Trust

Series

2019-INV2,

Class

A1,

CMO,

ARM

2.913%,

7/25/59  (1)

597‌

575‌

Verus

Securitization

Trust

Series

2019-INV3,

Class

A1,

CMO,

ARM

2.692%,

11/25/59  (1)

1,075‌

1,009‌

Verus

Securitization

Trust

Series

2020-1,

Class

A1,

CMO,

STEP

2.417%,

1/25/60  (1)

747‌

701‌

Verus

Securitization

Trust

Series

2020-2,

Class

A1,

CMO,

ARM

2.226%,

5/25/60  (1)

746‌

715‌

Verus

Securitization

Trust

Series

2020-4,

Class

A1,

CMO,

STEP

1.502%,

5/25/65  (1)

1,088‌

971‌

Verus

Securitization

Trust

Series

2020-5,

Class

A1,

CMO,

STEP

1.218%,

5/25/65  (1)

3,148‌

2,860‌

Verus

Securitization

Trust

Series

2020-INV1,

Class

A1,

CMO,

ARM

1.977%,

3/25/60  (1)

814‌

776‌

Verus

Securitization

Trust

Series

2021-1,

Class

A1,

CMO,

ARM

0.815%,

1/25/66  (1)

6,445‌

5,223‌

Verus

Securitization

Trust

Series

2021-2,

Class

A1,

CMO,

ARM

1.031%,

2/25/66  (1)

5,317‌

4,391‌

Verus

Securitization

Trust

Series

2021-5,

Class

A1,

CMO,

ARM

1.013%,

9/25/66  (1)

14,033‌

11,197‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

36

Par/Shares

$

Value

(Amounts

in

000s)

Verus

Securitization

Trust

Series

2021-R1,

Class

A1,

CMO,

ARM

0.82%,

10/25/63  (1)

2,445‌

2,125‌

Verus

Securitization

Trust

Series

2021-R3,

Class

A1,

CMO,

ARM

1.02%,

4/25/64  (1)

9,264‌

7,988‌

Vista

Point

Securitization

Trust

Series

2020-2,

Class

A1,

CMO,

ARM

1.475%,

4/25/65  (1)

2,968‌

2,593‌

227,580‌

Total

Non-U.S.

Government

Mortgage-Backed

Securities

(Cost

$345,147)

301,581‌

U.S.

GOVERNMENT

&

AGENCY

MORTGAGE-BACKED

SECURITIES

0.0%

U.S.

Government

Agency

Obligations

0.0%

Federal

Home

Loan

Mortgage,

CMO,

ARM,

1M

USD

LIBOR

+

0.35%,

4.223%,

2/15/45 

190‌

184‌

Federal

National

Mortgage

Assn.,

CMO,

ARM,

1M

USD

LIBOR

+

0.40%,

4.416%,

1/25/45 

154‌

150‌

Total

U.S.

Government

&

Agency

Mortgage-Backed

Securities

(Cost

$344)

334‌

U.S.

GOVERNMENT

AGENCY

OBLIGATIONS

(EXCLUDING

MORTGAGE-BACKED)

3.2%

U

S

Treasury

Obligations

3.2%

U.S.

Treasury

Bills,

0.93%,

12/15/22  (5)

21,000‌

20,974‌

U.S.

Treasury

Bills,

1.28%,

12/8/22 

50,000‌

49,965‌

U.S.

Treasury

Bills,

2.34%,

1/26/23  (5)

21,000‌

20,867‌

91,806‌

Total

U.S.

Government

Agency

Obligations

(Excluding

Mortgage-

Backed)

(Cost

$91,851)

91,806‌

SHORT-TERM

INVESTMENTS

11.7%

Commercial

Paper

11.7%

4(2)

9.8%(6)

Arrow

Electronics,

4.425%,

12/1/22 

27,500‌

27,497‌

Bacardi

Martini,

4.714%,

12/21/22 

10,000‌

9,975‌

Conagra

Foods,

4.351%,

12/1/22 

38,375‌

38,370‌

Crown

Castle

Intl,

4.693%,

12/6/22 

24,550‌

24,532‌

Crown

Castle

Intl,

5.085%,

1/17/23 

2,750‌

2,732‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

37

Par/Shares

$

Value

(Amounts

in

000s)

Enel

Finance,

3.299%,

4/21/23 

4,750‌

4,638‌

Enel

Finance,

5.225%,

1/3/23 

14,750‌

14,685‌

Energy

Transfer

Partners,

4.501%,

12/1/22 

10,000‌

9,999‌

Enterprise

Products,

4.06%,

12/1/22 

7,500‌

7,499‌

Fortune

Brands

Home,

4.713%,

12/5/22 

27,000‌

26,984‌

Harley-Davidson

Financial

Services,

4.662%,

12/6/22 

6,500‌

6,495‌

Harley-Davidson

Financial

Services,

4.975%,

1/4/23 

20,000‌

19,910‌

International

Flavors

&

Fragrances,

2.10%,

12/21/22 

9,750‌

9,725‌

International

Flavors

&

Fragrances,

4.658%,

12/5/22 

8,000‌

7,995‌

Plains

All

American

Pipeline,

4.351%,

12/1/22 

2,300‌

2,300‌

Rogers

Communications,

4.593%,

12/8/22 

13,000‌

12,988‌

Sempra

Energy,

4.101%,

12/2/22 

5,550‌

5,549‌

Syngenta

Wilmington,

4.71%,

12/1/22 

15,000‌

14,998‌

Syngenta

Wilmington,

4.764%,

12/7/22 

9,600‌

9,592‌

Targa

Resources,

4.762%,

12/7/22 

12,000‌

11,991‌

Targa

Resources,

4.818%,

12/6/22 

15,000‌

14,990‌

283,444‌

Non-4(2)

1.9%

Ovintiv,

4.862%,

12/12/22 

14,000‌

13,979‌

Ovintiv,

4.918%,

12/19/22 

14,450‌

14,415‌

Quanta

Services,

4.712%,

12/6/22 

6,000‌

5,995‌

Quanta

Services,

4.717%,

12/14/22 

7,200‌

7,187‌

Quanta

Services,

4.814%,

12/13/22 

15,000‌

14,975‌

56,551‌

Total

Commercial

Paper

339,995‌

Money

Market

Funds

0.0%

T.

Rowe

Price

Government

Reserve

Fund,

3.86%  (7)(8)

3‌

3‌

Total

Money

Market

Funds

3‌

Total

Short-Term

Investments

(Cost

$340,061)

339,998‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

38

Par/Shares

$

Value

(Amounts

in

000s)

SECURITIES

LENDING

COLLATERAL

0.0%

INVESTMENTS

IN

A

POOLED

ACCOUNT

THROUGH

SECURITIES

LENDING

PROGRAM

WITH

JPMORGAN

CHASE

BANK

0.0%

Money

Market

Funds

0.0%

T.

Rowe

Price

Government

Reserve

Fund,

3.86%  (7)(8)

1,152‌

1,152‌

Total

Investments

in

a

Pooled

Account

through

Securities

Lending

Program

with

JPMorgan

Chase

Bank

1,152‌

Total

Securities

Lending

Collateral

(Cost

$1,152)

1,152‌

Total

Investments

in

Securities

100.5%

of

Net

Assets

(Cost

$3,019,063)

$

2,913,098‌

‡

Par/Shares

and

Notional

Amount

are

denominated

in

U.S.

dollars

unless

otherwise

noted.

(1)

Security

was

purchased

pursuant

to

Rule

144A

under

the

Securities

Act

of

1933

and

may

be

resold

in

transactions

exempt

from

registration

only

to

qualified

institutional

buyers.

Total

value

of

such

securities

at

period-end

amounts

to

$1,170,703

and

represents

40.4%

of

net

assets.

(2)

Security

is

a

fix-to-float

security,

which

carries

a

fixed

coupon

until

a

certain

date,

upon

which

it

switches

to

a

floating

rate.

Reference

rate

and

spread

are

provided

if

the

rate

is

currently

floating.

(3)

See

Note

4

.

All

or

a

portion

of

this

security

is

on

loan

at

November

30,

2022.

(4)

Insured

by

Assured

Guaranty

Municipal

Corporation

(5)

At

November

30,

2022,

all

or

a

portion

of

this

security

is

pledged

as

collateral

and/or

margin

deposit

to

cover

future

funding

obligations.

(6)

Commercial

paper

exempt

from

registration

under

Section

4(2)

of

the

Securities

Act

of

1933

and

may

be

resold

in

transactions

exempt

from

registration

only

to

dealers

in

that

program

or

other

"accredited

investors".

Total

value

of

such

securities

at

period-end

amounts

to

$283,444

and

represents

9.8%

of

net

assets.

(7)

Seven-day

yield

(8)

Affiliated

Companies

1M

TSFR

One

month

term

SOFR

(Secured

overnight

financing

rate)

1M

USD

LIBOR

One

month

USD

LIBOR

(London

interbank

offered

rate)

3M

USD

LIBOR

Three

month

USD

LIBOR

(London

interbank

offered

rate)

ARM

Adjustable

Rate

Mortgage

(ARM);

rate

shown

is

effective

rate

at

period-end.

The

rates

for

certain

ARMs

are

not

based

on

a

published

reference

rate

and

spread

but

may

be

determined

using

a

formula

based

on

the

rates

of

the

underlying

loans. 

CLO

Collateralized

Loan

Obligation

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

39

.

.

.

.

.

.

.

.

.

.

CMO

Collateralized

Mortgage

Obligation

FRN

Floating

Rate

Note

JPY

Japanese

Yen

SOFR

Secured

overnight

financing

rate

SOFRINDX

(Secured

overnight

financing

rate)

Index

SOFR30A

30-day

Average

SOFR

(Secured

overnight

financing

rate)

STEP

Stepped

coupon

bond

for

which

the

coupon

rate

of

interest

adjusts

on

specified

date(s);

rate

shown

is

effective

rate

at

period-end.

USD

U.S.

Dollar

VR

Variable

Rate;

rate

shown

is

effective

rate

at

period-end.

The

rates

for

certain

variable

rate

securities

are

not

based

on

a

published

reference

rate

and

spread

but

are

determined

by

the

issuer

or

agent

and

based

on

current

market

conditions.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

40

(Amounts

in

000s)

SWAPS

0.0%

Description

Notional

Amount

$

Value

Upfront

Payments/

$

(Receipts)

Unrealized

$

Gain/(Loss)

BILATERAL

SWAPS

0.0%

Credit

Default

Swaps,

Protection

Sold

0.0%

Barclays

Bank,

Protection

Sold

(Relevant

Credit:

AT&T,

Baa2*),

Receive

1.00%

Quarterly,

Pay

upon

credit

default,

12/20/22

10,000

22

3

19‌

Goldman

Sachs,

Protection

Sold

(Relevant

Credit:

Pioneer

Natural

Resources,

BBB*),

Receive

1.00%

Quarterly,

Pay

upon

credit

default,

12/20/22

20,000

48

8

40‌

Total

Bilateral

Credit

Default

Swaps,

Protection

Sold

11

59‌

Total

Bilateral

Swaps

11

59‌

Description

Notional

Amount

$

Value

Initial

$

Value

Unrealized

$

Gain/(Loss)

CENTRALLY

CLEARED

SWAPS

0.0%

Credit

Default

Swaps,

Protection

Sold

0.0%

Protection

Sold

(Relevant

Credit:

AT&T,

Baa2*),

Receive

1.00%

Quarterly,

Pay

upon

credit

default,

12/20/23

25,000

89

295

(

206‌

)

Protection

Sold

(Relevant

Credit:

Bank

of

America,

A-*),

Receive

1.00%

Quarterly,

Pay

upon

credit

default,

12/20/23

20,000

154

277

(

123‌

)

Protection

Sold

(Relevant

Credit:

Citibank,

A3*),

Receive

1.00%

Quarterly,

Pay

upon

credit

default,

12/20/23

20,000

147

269

(

122‌

)

Protection

Sold

(Relevant

Credit:

Devon

Energy,

Baa2*),

Receive

1.00%

Quarterly,

Pay

upon

credit

default,

6/20/23

10,000

45

22

23‌

Protection

Sold

(Relevant

Credit:

Devon

Energy,

Baa2*),

Receive

1.00%

Quarterly,

Pay

upon

credit

default,

6/20/24

10,000

57

19

38‌

Protection

Sold

(Relevant

Credit:

Hess,

Baa3*),

Receive

1.00%

Quarterly,

Pay

upon

credit

default,

6/20/24

10,000

72

53

19‌

Protection

Sold

(Relevant

Credit:

Lennar,

Baa2*),

Receive

5.00%

Quarterly,

Pay

upon

credit

default,

6/20/23

10,000

349

516

(

167‌

)

Protection

Sold

(Relevant

Credit:

T-Mobile

US,

Baa3*),

Receive

5.00%

Quarterly,

Pay

upon

credit

default,

6/21/27

*

10,000

343

525

(

182‌

)

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

41

(Amounts

in

000s)

Description

Notional

Amount

$

Value

Initial

$

Value

Unrealized

$

Gain/(Loss)

Protection

Sold

(Relevant

Credit:

Verizon

Communications,

Baa1*),

Receive

1.00%

Quarterly,

Pay

upon

credit

default,

12/20/23

25,000

114

343

(

229‌

)

Total

Centrally

Cleared

Credit

Default

Swaps,

Protection

Sold

(

949‌

)

Total

Centrally

Cleared

Swaps

(

949‌

)

Net

payments

(receipts)

of

variation

margin

to

date

959‌

Variation

margin

receivable

(payable)

on

centrally

cleared

swaps

$

10‌

*

Credit

ratings

as

of

November

30,

2022.

Ratings

shown

are

from

Moody’s

Investors

Service

and

if

Moody’s

does

not

rate

a

security,

then

Standard

&

Poor’s

(S&P)

is

used.

Fitch

is

used

for

securities

that

are

not

rated

by

either

Moody’s

or

S&P.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

42

(Amounts

in

000s)

FORWARD

CURRENCY

EXCHANGE

CONTRACTS

Counterparty

Settlement

Receive

Deliver

Unrealized

Gain/(Loss)

HSBC

Bank

2/13/23

USD

7,543‌

JPY

1,045,950‌

$

(

108‌

)

State

Street

2/6/23

USD

7,224‌

JPY

1,057,200‌

(

501‌

)

Net

unrealized

gain

(loss)

on

open

forward

currency

exchange

contracts

$

(

609‌

)

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

43

FUTURES

CONTRACTS

($000s)

Expiration

Date

Notional

Amount

Value

and

Unrealized

Gain

(Loss)

Short,

23

U.S.

Treasury

Long

Bond

contracts

3/23

(2,921)

$

(

39‌

)

Short,

1,024

U.S.

Treasury

Notes

five

year

contracts

3/23

(111,176)

(

673‌

)

Short,

497

U.S.

Treasury

Notes

ten

year

contracts

3/23

(56,410)

(

447‌

)

Short,

609

U.S.

Treasury

Notes

two

year

contracts

3/23

(125,064)

(

339‌

)

Net

payments

(receipts)

of

variation

margin

to

date

522‌

Variation

margin

receivable

(payable)

on

open

futures

contracts

$

(

976‌

)

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

44

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

AFFILIATED

COMPANIES

($000s)

The

fund

may

invest

in

certain

securities

that

are

considered

affiliated

companies.

As

defined

by

the

1940

Act,

an

affiliated

company

is

one

in

which

the

fund

owns

5%

or

more

of

the

outstanding

voting

securities,

or

a

company

that

is

under

common

ownership

or

control.

The

following

securities

were

considered

affiliated

companies

for

all

or

some

portion

of

the

six

months

ended

November

30,

2022.

Net

realized

gain

(loss),

investment

income,

change

in

net

unrealized

gain/loss,

and

purchase

and

sales

cost

reflect

all

activity

for

the

period

then

ended.

Affiliate

Net

Realized

Gain

(Loss)

Change

in

Net

Unrealized

Gain/Loss

Investment

Income

T.

Rowe

Price

Government

Reserve

Fund,

3.86%

$

—‌

$

—‌

$

8‌

++

Totals

$

—‌

#

$

—‌

$

8‌

+

Supplementary

Investment

Schedule

Affiliate

Value

05/31/22

Purchase

Cost

Sales

Cost

Value

11/30/22

T.

Rowe

Price

Government

Reserve

Fund,

3.86%

$

3‌

¤

¤

$

1,155‌

Total

$

1,155‌

^

#

Capital

gain

distributions

from

underlying

Price

funds

represented

$0

of

the

net

realized

gain

(loss).

++

Excludes

earnings

on

securities

lending

collateral,

which

are

subject

to

rebates

and

fees

as

described

in

Note

4

.

+

Investment

income

comprised

$8

of

dividend

income

and

$0

of

interest

income.

¤

Purchase

and

sale

information

not

shown

for

cash

management

funds.

^

The

cost

basis

of

investments

in

affiliated

companies

was

$1,155.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

November

30,

2022

(Unaudited)

Statement

of

Assets

and

Liabilities

45

($000s,

except

shares

and

per

share

amounts)

Assets

Investments

in

securities,

at

value

(cost

$3,019,063)

$

2,913,098‌

Interest

receivable

17,161‌

Receivable

for

shares

sold

5,138‌

Cash

4,966‌

Receivable

for

investment

securities

sold

274‌

Unrealized

gain

on

bilateral

swaps

59‌

Bilateral

swap

premiums

paid

11‌

Variation

margin

receivable

on

centrally

cleared

swaps

10‌

Foreign

currency

(cost

$4)

4‌

Other

assets

89‌

Total

assets

2,940,810‌

Liabilities

Payable

for

investment

securities

purchased

30,717‌

Payable

for

shares

redeemed

7,165‌

Obligation

to

return

securities

lending

collateral

1,152‌

Variation

margin

payable

on

futures

contracts

976‌

Unrealized

loss

on

forward

currency

exchange

contracts

609‌

Investment

management

fees

payable

388‌

Due

to

affiliates

16‌

Payable

to

directors

1‌

Other

liabilities

853‌

Total

liabilities

41,877‌

NET

ASSETS

$

2,898,933‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

November

30,

2022

(Unaudited)

Statement

of

Assets

and

Liabilities

46

($000s,

except

shares

and

per

share

amounts)

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Net

Assets

Consist

of:

Total

distributable

earnings

(loss)

$

(

125,198‌

)

Paid-in

capital

applicable

to

590,969,527

shares

of

$0.01

par

value

capital

stock

outstanding;

6,000,000,000

shares

of

the

Corporation

authorized

3,024,131‌

NET

ASSETS

$

2,898,933‌

NET

ASSET

VALUE

PER

SHARE

Investor

Class

($1,844,755,605

/

376,255,673

shares

outstanding)

$

4.90‌

I

Class

($1,054,080,905

/

214,694,246

shares

outstanding)

$

4.91‌

Z

Class

($96,225

/

19,608

shares

outstanding)

$

4.91‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

(Unaudited)

Statement

of

Operations

47

($000s)

6

Months

Ended

11/30/22

Investment

Income

(Loss)

Income

    Interest

$

37,988‌

Securities

lending

64‌

Dividend

8‌

Total

income

38,060‌

Expenses

Investment

management

2,631‌

Shareholder

servicing

Investor

Class

$

1,580‌

I

Class

71‌

1,651‌

Prospectus

and

shareholder

reports

Investor

Class

56‌

I

Class

12‌

68‌

Custody

and

accounting

162‌

Registration

61‌

Legal

and

audit

18‌

Directors

4‌

Miscellaneous

21‌

Waived

/

paid

by

Price

Associates

(

241‌

)

Total

expenses

4,375‌

Net

investment

income

33,685‌

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

(Unaudited)

Statement

of

Operations

48

($000s)

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

6

Months

Ended

11/30/22

Realized

and

Unrealized

Gain

/

Loss

–

Net

realized

gain

(loss)

Securities

(

40,136‌

)

Futures

10,545‌

Swaps

1,053‌

Forward

currency

exchange

contracts

12,677‌

Foreign

currency

transactions

(

120‌

)

Net

realized

loss

(

15,981‌

)

Change

in

net

unrealized

gain

/

loss

Securities

(

19,064‌

)

Futures

(

1,354‌

)

Swaps

(

571‌

)

Forward

currency

exchange

contracts

(

5,373‌

)

Change

in

net

unrealized

gain

/

loss

(

26,362‌

)

Net

realized

and

unrealized

gain

/

loss

(

42,343‌

)

DECREASE

IN

NET

ASSETS

FROM

OPERATIONS

$

(

8,658‌

)

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

(Unaudited)

Statement

of

Changes

in

Net

Assets

49

($000s)

6

Months

Ended

11/30/22

Year

Ended

5/31/22

Increase

(Decrease)

in

Net

Assets

Operations

Net

investment

income

$

33,685‌

$

35,124‌

Net

realized

gain

(loss)

(

15,981‌

)

16,397‌

Change

in

net

unrealized

gain

/

loss

(

26,362‌

)

(

103,685‌

)

Decrease

in

net

assets

from

operations

(

8,658‌

)

(

52,164‌

)

Distributions

to

shareholders

Net

earnings

Investor

Class

(

21,548‌

)

(

39,919‌

)

I

Class

(

13,232‌

)

(

15,021‌

)

Z

Class

(

1‌

)

(

1‌

)

Decrease

in

net

assets

from

distributions

(

34,781‌

)

(

54,941‌

)

Capital

share

transactions

*

Shares

sold

Investor

Class

467,185‌

1,854,223‌

I

Class

290,853‌

1,188,222‌

Distributions

reinvested

Investor

Class

21,333‌

37,405‌

I

Class

11,910‌

13,992‌

Shares

redeemed

Investor

Class

(

1,025,176‌

)

(

3,573,857‌

)

I

Class

(

521,330‌

)

(

739,696‌

)

Decrease

in

net

assets

from

capital

share

transactions

(

755,225‌

)

(

1,219,711‌

)

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

(Unaudited)

Statement

of

Changes

in

Net

Assets

50

($000s)

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

6

Months

Ended

11/30/22

Year

Ended

5/31/22

Net

Assets

Decrease

during

period

(

798,664‌

)

(

1,326,816‌

)

Beginning

of

period

3,697,597‌

5,024,413‌

End

of

period

$

2,898,933‌

$

3,697,597‌

*Share

information

(000s)

Shares

sold

Investor

Class

94,916‌

367,268‌

I

Class

58,934‌

235,337‌

Distributions

reinvested

Investor

Class

4,341‌

7,422‌

I

Class

2,419‌

2,775‌

Shares

redeemed

Investor

Class

(

208,227‌

)

(

708,733‌

)

I

Class

(

105,791‌

)

(

146,763‌

)

Decrease

in

shares

outstanding

(

153,408‌

)

(

242,694‌

)

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

Unaudited

NOTES

TO

FINANCIAL

STATEMENTS

51

T.

Rowe

Price

Short-Term

Bond

Fund,

Inc.

(the

corporation) is

registered

under

the

Investment

Company

Act

of

1940

(the

1940

Act).

The

Ultra

Short-Term

Bond

Fund

(the

fund)

is a

diversified,

open-end

management

investment

company

established

by

the

corporation. The

fund

seeks

a

high

level

of

income

consistent

with

minimal

fluctuation

in

principal

value

and

liquidity.

The

fund

has

three classes

of

shares:

the

Ultra

Short-Term

Bond

Fund

(Investor

Class),

the

Ultra

Short-Term

Bond

Fund–I

Class

(I

Class)

and

the

Ultra

Short-Term

Bond

Fund–Z

Class

(Z

Class).

I

Class

shares

require

a

$500,000

initial

investment

minimum,

although

the

minimum

generally

is

waived

or

reduced

for

financial

intermediaries,

eligible

retirement

plans,

and

certain

other

accounts.

Prior

to

November

15,

2021,

the

initial

investment

minimum

was

$1

million

and

was

generally

waived

for

financial

intermediaries,

eligible

retirement

plans,

and

other

certain

accounts.

As

a

result

of

the

reduction

in

the

I

Class

minimum,

certain

assets

transferred

from

the

Investor

Class

to

the

I

Class.

This

transfer

of

shares

from

Investor

Class

to

I

Class

is

reflected

in

the

Statement

of

Changes

in

Net

Assets

within

the

Capital

shares

transactions

as

Shares

redeemed

and

Shares

sold,

respectively.

The

Z

Class

is

only

available

to

funds

advised

by

T.

Rowe

Price

Associates,

Inc.

and

its

affiliates

and

other

clients

that

are

subject

to

a

contractual

fee

for

investment

management

services. Each

class

has

exclusive

voting

rights

on

matters

related

solely

to

that

class;

separate

voting

rights

on

matters

that

relate

to

all

classes;

and,

in

all

other

respects,

the

same

rights

and

obligations

as

the

other

classes.

NOTE

1

-

SIGNIFICANT

ACCOUNTING

POLICIES 

Basis

of

Preparation

 The fund

is

an

investment

company

and

follows

accounting

and

reporting

guidance

in

the

Financial

Accounting

Standards

Board

(FASB)

Accounting

Standards

Codification

Topic

946

(ASC

946).

The

accompanying

financial

statements

were

prepared

in

accordance

with

accounting

principles

generally

accepted

in

the

United

States

of

America

(GAAP),

including,

but

not

limited

to,

ASC

946.

GAAP

requires

the

use

of

estimates

made

by

management.

Management

believes

that

estimates

and

valuations

are

appropriate;

however,

actual

results

may

differ

from

those

estimates,

and

the

valuations

reflected

in

the

accompanying

financial

statements

may

differ

from

the

value

ultimately

realized

upon

sale

or

maturity.

Investment

Transactions,

Investment

Income,

and

Distributions

Investment

transactions

are

accounted

for

on

the

trade

date

basis.

Income

and

expenses

are

recorded

on

the

accrual

basis.

Realized

gains

and

losses

are

reported

on

the

identified

cost

basis.

Premiums

and

discounts

on

debt

securities

are

amortized

for

financial

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

52

reporting

purposes.

Paydown

gains

and

losses

are

recorded

as

an

adjustment

to

interest

income.

Income

tax-related

interest

and

penalties,

if

incurred,

are

recorded

as

income

tax

expense.

Dividends

received

from

mutual

fund

investments

are

reflected

as

dividend

income;

capital

gain

distributions

are

reflected

as

realized

gain/loss.

Dividend

income

and

capital

gain

distributions

are

recorded

on

the

ex-dividend

date.

Non-cash

dividends,

if

any,

are

recorded

at

the

fair

market

value

of

the

asset

received.

Distributions

to

shareholders

are

recorded

on

the

ex-dividend

date.

Income

distributions,

if

any, are

declared

by

each

class daily

and

paid

monthly.

A

capital

gain

distribution,

if

any, may

also

be

declared

and

paid

by

the

fund

annually.

Currency

Translation

 Assets,

including

investments,

and

liabilities

denominated

in

foreign

currencies

are

translated

into

U.S.

dollar

values

each

day

at

the

prevailing

exchange

rate,

using

the

mean

of

the

bid

and

asked

prices

of

such

currencies

against

U.S.

dollars

as

provided

by

an

outside

pricing

service.

Purchases

and

sales

of

securities,

income,

and

expenses

are

translated

into

U.S.

dollars

at

the

prevailing

exchange

rate

on

the

respective

date

of

such

transaction.

The

effect

of

changes

in

foreign

currency

exchange

rates

on

realized

and

unrealized

security

gains

and

losses

is

not

bifurcated

from

the

portion

attributable

to

changes

in

market

prices.

Class

Accounting

 Shareholder

servicing,

prospectus,

and

shareholder

report

expenses

incurred

by

each

class

are

charged

directly

to

the

class

to

which

they

relate.

Expenses

common

to all classes

and

investment

income

are

allocated

to

the

classes

based

upon

the

relative

daily

net

assets

of

each

class’s

settled

shares;

realized

and

unrealized

gains

and

losses

are

allocated

based

upon

the

relative

daily

net

assets

of

each

class’s

outstanding

shares.

Capital

Transactions

 Each

investor’s

interest

in

the

net

assets

of the

fund

is

represented

by

fund

shares. The

fund’s

net

asset

value

(NAV)

per

share

is

computed

at

the

close

of

the

New

York

Stock

Exchange

(NYSE),

normally

4

p.m.

ET,

each

day

the

NYSE

is

open

for

business.

However,

the

NAV

per

share

may

be

calculated

at

a

time

other

than

the

normal

close

of

the

NYSE

if

trading

on

the

NYSE

is

restricted,

if

the

NYSE

closes

earlier,

or

as

may

be

permitted

by

the

SEC.

Purchases

and

redemptions

of

fund

shares

are

transacted

at

the

next-computed

NAV

per

share,

after

receipt

of

the

transaction

order

by

T.

Rowe

Price

Associates,

Inc.,

or

its

agents.

New

Accounting

Guidance

The

FASB

issued

Accounting

Standards

Update

(ASU),

ASU

2020–04,

Reference

Rate

Reform

(Topic

848) –

Facilitation

of

the

Effects

of

Reference

Rate

Reform

on

Financial

Reporting

in

March

2020

and

ASU

2021-01

in

January

2021

which

provided

further

amendments

and

clarifications

to

Topic

848.

These

ASUs provide

optional,

temporary

relief

with

respect

to

the

financial

reporting

of

contracts

subject

to

certain

types

of

modifications

due

to

the

planned

discontinuation

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

53

of

the

London

Interbank

Offered

Rate

(LIBOR),

and

other

interbank-offered

based

reference

rates,

through December

31,

2022.

Management

intends

to

rely

upon

the

relief

provided

under

Topic

848,

which

is

not

expected to

have

a

material

impact

on

the fund's

financial  statements.

Indemnification

 In

the

normal

course

of

business, the

fund

may

provide

indemnification

in

connection

with

its

officers

and

directors,

service

providers,

and/or

private

company

investments. The

fund’s

maximum

exposure

under

these

arrangements

is

unknown;

however,

the

risk

of

material

loss

is

currently

considered

to

be

remote.

NOTE

2

-

VALUATION 

Fair

Value

  The

fund’s

financial

instruments

are

valued

at

the

close

of

the

NYSE

and

are

reported

at

fair

value,

which

GAAP

defines

as

the

price

that

would

be

received

to

sell

an

asset

or

paid

to

transfer

a

liability

in

an

orderly

transaction

between

market

participants

at

the

measurement

date. The fund’s

Board

of

Directors

(the

Board)

has

designated

T.

Rowe

Price

Associates,

Inc.

as

the

fund’s

valuation

designee

(Valuation

Designee).

Subject

to

oversight

by

the

Board,

the

Valuation

Designee

performs

the

following

functions

in

performing

fair

value

determinations:

assesses

and

manages

valuation

risks;

establishes

and

applies

fair

value

methodologies;

tests

fair

value

methodologies;

and

evaluates

pricing

vendors

and

pricing

agents.

The

duties

and

responsibilities

of

the

Valuation

Designee

are

performed

by

its

Valuation

Committee. The

Valuation

Designee provides

periodic

reporting

to

the

Board

on

valuation

matters.

Various

valuation

techniques

and

inputs

are

used

to

determine

the

fair

value

of

financial

instruments.

GAAP

establishes

the

following

fair

value

hierarchy

that

categorizes

the

inputs

used

to

measure

fair

value:

Level

1

–

quoted

prices

(unadjusted)

in

active

markets

for

identical

financial

instruments

that

the

fund

can

access

at

the

reporting

date

Level

2

–

inputs

other

than

Level

1

quoted

prices

that

are

observable,

either

directly

or

indirectly

(including,

but

not

limited

to,

quoted

prices

for

similar

financial

instruments

in

active

markets,

quoted

prices

for

identical

or

similar

financial

instruments

in

inactive

markets,

interest

rates

and

yield

curves,

implied

volatilities,

and

credit

spreads)

Level

3

–

unobservable

inputs

(including

the Valuation

Designee’s assumptions

in

determining

fair

value)

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

54

Observable

inputs

are

developed

using

market

data,

such

as

publicly

available

information

about

actual

events

or

transactions,

and

reflect

the

assumptions

that

market

participants

would

use

to

price

the

financial

instrument.

Unobservable

inputs

are

those

for

which

market

data

are

not

available

and

are

developed

using

the

best

information

available

about

the

assumptions

that

market

participants

would

use

to

price

the

financial

instrument.

GAAP

requires

valuation

techniques

to

maximize

the

use

of

relevant

observable

inputs

and

minimize

the

use

of

unobservable

inputs.

When

multiple

inputs

are

used

to

derive

fair

value,

the

financial

instrument

is

assigned

to

the

level

within

the

fair

value

hierarchy

based

on

the

lowest-level

input

that

is

significant

to

the

fair

value

of

the

financial

instrument.

Input

levels

are

not

necessarily

an

indication

of

the

risk

or

liquidity

associated

with

financial

instruments

at

that

level

but

rather

the

degree

of

judgment

used

in

determining

those

values.

Valuation

Techniques 

Debt

securities

generally

are

traded

in

the over-the-counter

(OTC)

market

and

are

valued

at

prices

furnished

by

independent

pricing

services

or

by

broker

dealers

who

make

markets

in

such

securities.

When

valuing

securities,

the

independent

pricing

services

consider

the

yield

or

price

of

bonds

of

comparable

quality,

coupon,

maturity,

and

type,

as

well

as

prices

quoted

by

dealers

who

make

markets

in

such

securities.   

Investments

in

mutual

funds

are

valued

at

the

mutual

fund’s

closing

NAV

per

share

on

the

day

of

valuation.

Futures

contracts

are

valued

at

closing

settlement

prices.

Forward

currency

exchange

contracts

are

valued

using

the

prevailing

forward

exchange

rate.

Swaps

are

valued

at

prices

furnished

by

an

independent

pricing

service

or

independent

swap

dealers.

Assets

and

liabilities

other

than

financial

instruments,

including

short-

term

receivables

and

payables,

are

carried

at

cost,

or

estimated

realizable

value,

if

less,

which

approximates

fair

value. 

Investments

for

which

market

quotations are

not

readily

available

or

deemed

unreliable

are

valued

at

fair

value

as

determined

in

good

faith

by

the

Valuation

Designee.

The

Valuation

Designee

has

adopted

methodologies

for

determining

the

fair

value

of

investments

for

which

market

quotations

are

not

readily

available

or

deemed

unreliable,

including

the

use

of

other

pricing

sources.

Factors

used

in

determining

fair

value

vary

by

type

of

investment

and

may

include

market

or

investment

specific

considerations.

The

Valuation

Designee typically

will

afford

greatest

weight

to

actual

prices

in

arm’s

length

transactions,

to

the

extent

they

represent

orderly

transactions

between

market

participants,

transaction

information

can

be

reliably

obtained,

and

prices

are

deemed

representative

of

fair

value.

However,

the

Valuation

Designee may

also

consider

other

valuation

methods

such

as

market-based

valuation

multiples;

a

discount

or

premium

from

market

value

of

a

similar,

freely

traded

security

of

the

same

issuer;

discounted

cash

flows;

yield

to

maturity;

or

some

combination.

Fair

value

determinations

are

reviewed

T.

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on

a

regular

basis.

Because

any

fair

value

determination

involves

a

significant

amount

of

judgment,

there

is

a

degree

of

subjectivity

inherent

in

such

pricing

decisions. Fair

value

prices

determined

by

the

Valuation

Designee could

differ

from

those

of

other

market

participants,

and

it

is

possible

that

the

fair

value

determined

for

a

security

may

be

materially

different

from

the

value

that

could

be

realized

upon

the

sale

of

that

security.

Valuation

Inputs

  The

following

table

summarizes

the

fund’s

financial

instruments,

based

on

the

inputs

used

to

determine

their

fair

values

on

November

30,

2022

(for

further

detail

by

category,

please

refer

to

the

accompanying

Portfolio

of

Investments):

($000s)

Level

1

Level

2

Level

3

Total

Value

Assets

Fixed

Income

Securities

1

$

—‌

$

2,571,948‌

$

—‌

$

2,571,948‌

Short-Term

Investments

3‌

339,995‌

—‌

339,998‌

Securities

Lending

Collateral

1,152‌

—‌

—‌

1,152‌

Total

Securities

1,155‌

2,911,943‌

—‌

2,913,098‌

Swaps*

—‌

150‌

—‌

150‌

Total

$

1,155‌

$

2,912,093‌

$

—‌

$

2,913,248‌

Liabilities

Swaps*

$

—‌

$

1,029‌

$

—‌

$

1,029‌

Forward

Currency

Exchange

Contracts

—‌

609‌

—‌

609‌

Futures

Contracts*

1,498‌

—‌

—‌

1,498‌

Total

$

1,498‌

$

1,638‌

$

—‌

$

3,136‌

1

Includes

Asset-Backed

Securities,

Corporate

Bonds,

Foreign

Government

Obligations

&

Municipalities,

Municipal

Securities,

Non-U.S.

Government

Mortgage-Backed

Securities,

U.S.

Government

&

Agency

Mortgage-Backed

Securities

and

U.S.

Government

Agency

Obligations

(Excluding

Mortgage-Backed).

*

The

fair

value

presented

includes

cumulative

gain

(loss)

on

open

futures

contracts

and

centrally

cleared

swaps;

however,

the

net

value

reflected

on

the

accompanying

Portfolio

of

Investments

is

only

the

unsettled

variation

margin

receivable

(payable)

at

that

date.

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NOTE

3

-

DERIVATIVE

INSTRUMENTS 

During

the

six

months ended

November

30,

2022,

the

fund

invested

in

derivative

instruments.

As

defined

by

GAAP,

a

derivative

is

a

financial

instrument

whose

value

is

derived

from

an

underlying

security

price,

foreign

exchange

rate,

interest

rate,

index

of

prices

or

rates,

or

other

variable;

it

requires

little

or

no

initial

investment

and

permits

or

requires

net

settlement.

The

fund

invests

in

derivatives

only

if

the

expected

risks

and

rewards

are

consistent

with

its

investment

objectives,

policies,

and

overall

risk

profile,

as

described

in

its

prospectus

and

Statement

of

Additional

Information.

The

fund

may

use

derivatives

for

a

variety

of

purposes

and

may

use

them

to

establish

both

long

and

short

positions

within

the

fund’s

portfolio.

Potential

uses

include

to

hedge

against

declines

in

principal

value,

increase

yield,

invest

in

an

asset

with

greater

efficiency

and

at

a

lower

cost

than

is

possible

through

direct

investment,

to

enhance

return,

or

to

adjust

portfolio

duration

and

credit

exposure.

The

risks

associated

with

the

use

of

derivatives

are

different

from,

and

potentially

much

greater

than,

the

risks

associated

with

investing

directly

in

the

instruments

on

which

the

derivatives

are

based.

The

fund

values

its

derivatives

at

fair

value

and

recognizes

changes

in

fair

value

currently

in

its

results

of

operations.

Accordingly,

the

fund

does

not

follow

hedge

accounting,

even

for

derivatives

employed

as

economic

hedges.

Generally,

the

fund

accounts

for

its

derivatives

on

a

gross

basis.

It

does

not

offset

the

fair

value

of

derivative

liabilities

against

the

fair

value

of

derivative

assets

on

its

financial

statements,

nor

does

it

offset

the

fair

value

of

derivative

instruments

against

the

right

to

reclaim

or

obligation

to

return

collateral.

The

following

table

summarizes

the

fair

value

of

the

fund’s

derivative

instruments

held

as

of

November

30,

2022,

and

the

related

location

on

the

accompanying

Statement

of

Assets

and

Liabilities,

presented

by

primary

underlying

risk

exposure:

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Additionally,

the

amount

of

gains

and

losses

on

derivative

instruments

recognized

in

fund

earnings

during

the

six

months ended

November

30,

2022,

and

the

related

location

on

the

accompanying

Statement

of

Operations

is

summarized

in

the

following

table

by

primary

underlying

risk

exposure: 

($000s)

Location

on

Statement

of

Assets

and

Liabilities

Fair

Value*

Assets

Credit

derivatives

Bilateral

Swaps

and

Premiums

,

Centrally

Cleared

Swaps

$

150‌

*

Total

$

150‌

*

Liabilities

Interest

rate

derivatives

Futures

$

1,498‌

Foreign

exchange

derivatives

Forwards

609‌

Credit

derivatives

Centrally

Cleared

Swaps

1,029‌

Total

$

3,136‌

*

The

fair

value

presented

includes

cumulative

gain

(loss)

on

open

futures

contracts

and

centrally

cleared

swaps;

however,

the

value

reflected

on

the

accompanying

Statement

of

Assets

and

Liabilities

is

only

the

unsettled

variation

margin

receivable

(payable)

at

that

date.

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Counterparty

Risk

and

Collateral

 The

fund

invests

in

derivatives

in

various

markets,

which

expose

it

to

differing

levels

of

counterparty

risk.

Counterparty

risk

on

exchange-

traded

and

centrally

cleared

derivative

contracts,

such

as

futures,

exchange-traded

options,

and

centrally

cleared

swaps,

is

minimal

because

the

clearinghouse

provides

protection

against

counterparty

defaults.

For

futures

and

centrally

cleared

swaps,

the

fund

is

required

to

deposit

collateral

in

an

amount

specified

by

the

clearinghouse

and

the

clearing

firm

(margin

requirement),

and

the

margin

requirement

must

be

maintained

over

the

life

of

the

contract.

Each

clearinghouse

and

clearing

firm,

in

its

sole

discretion,

may

adjust

the

margin

requirements

applicable

to

the

fund.

Derivatives,

such

as

bilateral

swaps,

forward

currency

exchange

contracts,

and

OTC

options,

that

are

transacted

and

settle

directly

with

a

counterparty

(bilateral

derivatives)

may

expose

the

fund

to

greater

counterparty

risk.

To

mitigate

this

risk,

the

fund

has

entered

into

master

netting

arrangements

(MNAs)

with

certain

counterparties

that

permit

net

settlement

under

specified

conditions

and,

for

certain

counterparties,

also

($000s)                                               

Location

of

Gain

(Loss)

on

Statement

of

Operations

Futures

Forward

Currency

Exchange

Contracts

Swaps

Total

Realized

Gain

(Loss)

Interest

rate

derivatives

$

10,545‌

$

—‌

$

—‌

$

10,545‌

Foreign

exchange

derivatives

—‌

12,677‌

—‌

12,677‌

Credit

derivatives

—‌

—‌

1,053‌

1,053‌

Total

$

10,545‌

$

12,677‌

$

1,053‌

$

24,275‌

Change

in

Unrealized

Gain

(Loss)

Interest

rate

derivatives

$

(1,354‌)

$

—‌

$

—‌

$

(1,354‌)

Foreign

exchange

derivatives

—‌

(5,373‌)

—‌

(5,373‌)

Credit

derivatives

—‌

—‌

(571‌)

(571‌)

Total

$

(1,354‌)

$

(5,373‌)

$

(571‌)

$

(7,298‌)

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require

the

exchange

of

collateral

to

cover

mark-to-market

exposure.

MNAs

may

be

in

the

form

of

International

Swaps

and

Derivatives

Association

master

agreements

(ISDAs)

or

foreign

exchange

letter

agreements

(FX

letters).

MNAs

provide

the

ability

to

offset

amounts

the

fund

owes

a

counterparty

against

amounts

the

counterparty

owes

the

fund

(net

settlement).

Both

ISDAs

and

FX

letters

generally

allow

termination

of

transactions

and

net

settlement

upon

the

occurrence

of

contractually

specified

events,

such

as

failure

to

pay

or

bankruptcy.

In

addition,

ISDAs

specify

other

events,

the

occurrence

of

which

would

allow

one

of

the

parties

to

terminate.

For

example,

a

downgrade

in

credit

rating

of

a

counterparty

below

a

specified

rating

would

allow

the

fund

to

terminate,

while

a

decline

in

the

fund’s

net

assets

of

more

than

a

specified

percentage

would

allow

the

counterparty

to

terminate.

Upon

termination,

all

transactions

with

that

counterparty

would

be

liquidated

and

a

net

termination

amount

settled.

ISDAs

typically

include

collateral

agreements

whereas

FX

letters

do

not.

Collateral

requirements

are

determined

daily

based

on

the

net

aggregate

unrealized

gain

or

loss

on

all

bilateral

derivatives

with

a

counterparty,

subject

to

minimum

transfer

amounts

that

typically

range

from

$100,000

to

$250,000.

Any

additional

collateral

required

due

to

changes

in

security

values

is

typically

transferred

the

next

business

day.

Collateral

may

be

in

the

form

of

cash

or

debt

securities

issued

by

the

U.S.

government

or

related

agencies,

although

other

securities

may

be

used

depending

on

the

terms

outlined

in

the

applicable

MNA.

Cash

posted

by

the

fund

is

reflected

as

cash

deposits

in

the

accompanying

financial

statements

and

generally

is

restricted

from

withdrawal

by

the

fund;

securities

posted

by

the

fund

are

so

noted

in

the

accompanying

Portfolio

of

Investments;

both

remain

in

the

fund’s

assets.

Collateral

pledged

by

counterparties

is

not

included

in

the

fund’s

assets

because

the

fund

does

not

obtain

effective

control

over

those

assets.

For

bilateral

derivatives,

collateral

posted

or

received

by

the

fund

is

held

in

a

segregated

account

at

the

fund’s

custodian.

While

typically

not

sold

in

the

same

manner

as

equity

or

fixed

income

securities,

exchange-traded

or

centrally

cleared

derivatives

may

be

closed

out

only

on

the

exchange

or

clearinghouse

where

the

contracts

were

cleared,

and

OTC

and

bilateral

derivatives

may

be

unwound

with

counterparties

or

transactions

assigned

to

other

counterparties

to

allow

the

fund

to

exit

the

transaction.

This

ability

is

subject

to

the

liquidity

of

underlying

positions. As

of

November

30,

2022,

securities

valued

at $470,000 had

been

pledged

or

posted

by

the

fund

to

counterparties

for

bilateral

derivatives. As

of

November

30,

2022,

collateral

pledged

by

counterparties

to

the

fund

for

bilateral

derivatives

consisted

of $320,000 cash. As

of

November

30,

2022,

securities

valued

at $24,911,000

had

been

posted

by

the

fund

for

exchange-traded

and/or

centrally

cleared

derivatives.

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Forward

Currency

Exchange

Contracts

 The

fund

is

subject

to

foreign

currency

exchange

rate

risk

in

the

normal

course

of

pursuing

its

investment

objectives.

It may use

forward

currency

exchange

contracts

(forwards)

primarily

to

protect

its

non-U.S.

dollar-

denominated

securities

from

adverse

currency

movements

or

to

increase

exposure

to

a

particular

foreign

currency,

to

shift

the

fund’s

foreign

currency

exposure

from

one

country

to

another,

or

to

enhance

the

fund’s

return.

A

forward

involves

an

obligation

to

purchase

or

sell

a

fixed

amount

of

a

specific

currency

on

a

future

date

at

a

price

set

at

the

time

of

the

contract.

Although

certain

forwards

may

be

settled

by

exchanging

only

the

net

gain

or

loss

on

the

contract,

most

forwards

are

settled

with

the

exchange

of

the

underlying

currencies

in

accordance

with

the

specified

terms.

Forwards

are

valued

at

the

unrealized

gain

or

loss

on

the

contract,

which

reflects

the

net

amount

the

fund

either

is

entitled

to

receive

or

obligated

to

deliver,

as

measured

by

the

difference

between

the

forward

exchange

rates

at

the

date

of

entry

into

the

contract

and

the

forward

rates

at

the

reporting

date.

Appreciated

forwards

are

reflected

as

assets

and

depreciated

forwards

are

reflected

as

liabilities

on

the

accompanying

Statement

of

Assets

and

Liabilities.

Risks

related

to

the

use

of

forwards

include

the

possible

failure

of

counterparties

to

meet

the

terms

of

the

agreements;

that

anticipated

currency

movements

will

not

occur,

thereby

reducing

the

fund’s

total

return;

and

the

potential

for

losses

in

excess

of

the

fund’s

initial

investment.

During

the

six

months ended

November

30,

2022,

the

volume

of

the

fund’s

activity

in

forwards,

based

on

underlying

notional

amounts,

was

generally

between

1%

and

3%

of

net

assets.

Futures

Contracts

 The

fund

is

subject

to interest

rate

risk in

the

normal

course

of

pursuing

its

investment

objectives

and

uses

futures

contracts

to

help

manage

such

risk.

The

fund

may

enter

into

futures

contracts

to

manage

exposure

to

interest

rate

and

yield

curve

movements,

security

prices,

foreign

currencies,

credit

quality,

and

mortgage

prepayments;

as

an

efficient

means

of

adjusting

exposure

to

all

or

part

of

a

target

market;

to

enhance

income;

as

a

cash

management

tool;

or

to

adjust

portfolio

duration

and

credit

exposure. A

futures

contract

provides

for

the

future

sale

by

one

party

and

purchase

by

another

of

a

specified

amount

of

a

specific

underlying

financial

instrument

at

an

agreed-upon

price,

date,

time,

and

place.

The

fund

currently

invests

only

in

exchange-traded

futures,

which

generally

are

standardized

as

to

maturity

date,

underlying

financial

instrument,

and

other

contract

terms.

Payments

are

made

or

received

by

the

fund

each

day

to

settle

daily

fluctuations

in

the

value

of

the

contract

(variation

margin),

which

reflect

changes

in

the

value

of

the

underlying

financial

instrument.

Variation

margin

is

recorded

as

unrealized

gain

or

loss

until

the

contract

is

closed.

The

value

of

a

futures

contract

included

in

net

assets

is

the

amount

of

unsettled

variation

margin;

net

variation

margin

receivable

is

reflected

as

an

asset

and

net

variation

margin

payable

is

reflected

as

a

liability

on

the

accompanying

Statement

of

Assets

and

Liabilities.

Risks

related

to

the

use

of

futures

contracts

include

possible

T.

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illiquidity

of

the

futures

markets,

contract

prices

that

can

be

highly

volatile

and

imperfectly

correlated

to

movements

in

hedged

security

values

and/or

interest

rates,

and

potential

losses

in

excess

of

the

fund’s

initial

investment.

During

the

six

months ended

November

30,

2022,

the

volume

of

the

fund’s

activity

in

futures,

based

on

underlying

notional

amounts,

was

generally

between

4%

and

19%

of

net

assets.

Swaps

 The

fund

is

subject

to

credit

risk in

the

normal

course

of

pursuing

its

investment

objectives

and

uses

swap

contracts

to

help

manage

such

risk.

The

fund

may

use

swaps

in

an

effort

to

manage

both

long

and

short

exposure

to

changes

in

interest

rates,

inflation

rates,

and

credit

quality;

to

adjust

overall

exposure

to

certain

markets;

to

enhance

total

return

or

protect

the

value

of

portfolio

securities;

to

serve

as

a

cash

management

tool;

or

to

adjust

portfolio

duration

and

credit

exposure.

Swap

agreements

can

be

settled

either

directly

with

the

counterparty

(bilateral

swap)

or

through

a

central

clearinghouse

(centrally

cleared

swap).

Fluctuations

in

the

fair

value

of

a

contract

are

reflected

in

unrealized

gain

or

loss

and

are

reclassified

to

realized

gain

or

loss

upon

contract

termination

or

cash

settlement.

Net

periodic

receipts

or

payments

required

by

a

contract

increase

or

decrease,

respectively,

the

value

of

the

contract

until

the

contractual

payment

date,

at

which

time

such

amounts

are

reclassified

from

unrealized

to

realized

gain

or

loss.

For

bilateral

swaps,

cash

payments

are

made

or

received

by

the

fund

on

a

periodic

basis

in

accordance

with

contract

terms;

unrealized

gain

on

contracts

and

premiums

paid

are

reflected

as

assets

and

unrealized

loss

on

contracts

and

premiums

received

are

reflected

as

liabilities

on

the

accompanying

Statement

of

Assets

and

Liabilities.

For

bilateral

swaps,

premiums

paid

or

received

are

amortized

over

the

life

of

the

swap

and

are

recognized

as

realized

gain

or

loss

in

the

Statement

of

Operations.

For

centrally

cleared

swaps,

payments

are

made

or

received

by

the

fund

each

day

to

settle

the

daily

fluctuation

in

the

value

of

the

contract

(variation

margin).

Accordingly,

the

value

of

a

centrally

cleared

swap

included

in

net

assets

is

the

unsettled

variation

margin;

net

variation

margin

receivable

is

reflected

as

an

asset

and

net

variation

margin

payable

is

reflected

as

a

liability

on

the

accompanying

Statement

of

Assets

and

Liabilities.

Credit

default

swaps

are

agreements

where

one

party

(the

protection

buyer)

agrees

to

make

periodic

payments

to

another

party

(the

protection

seller)

in

exchange

for

protection

against

specified

credit

events,

such

as

certain

defaults

and

bankruptcies

related

to

an

underlying

credit

instrument,

or

issuer

or

index

of

such

instruments.

Upon

occurrence

of

a

specified

credit

event,

the

protection

seller

is

required

to

pay

the

buyer

the

difference

between

the

notional

amount

of

the

swap

and

the

value

of

the

underlying

credit,

either

in

the

form

of

a

net

cash

settlement

or

by

paying

the

gross

notional

amount

and

accepting

delivery

of

the

relevant

underlying

credit.

For

credit

default

swaps

where

the

underlying

credit

is

an

index,

a

specified

credit

event

may

affect

all

or

individual

underlying

securities

included

in

the

index

and

will

be

settled

based

upon

the

T.

ROWE

PRICE

Ultra

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Bond

Fund

62

relative

weighting

of

the

affected

underlying

security(ies)

within

the

index. Generally,

the

payment

risk

for

the

seller

of

protection

is

inversely

related

to

the

current

market

price

or

credit

rating

of

the

underlying

credit

or

the

market

value

of

the

contract

relative

to

the

notional

amount,

which

are

indicators

of

the

markets’

valuation

of

credit

quality.

As

of

November

30,

2022,

the

notional

amount

of

protection

sold

by

the

fund

totaled $170,000,000

(6.0%

of

net

assets),

which

reflects

the

maximum

potential

amount

the

fund

could

be

required

to

pay

under

such

contracts.

Risks

related

to

the

use

of

credit

default

swaps

include

the

possible

inability

of

the

fund

to

accurately

assess

the

current

and

future

creditworthiness

of

underlying

issuers,

the

possible

failure

of

a

counterparty

to

perform

in

accordance

with

the

terms

of

the

swap

agreements,

potential

government

regulation

that

could

adversely

affect

the

fund’s

swap

investments,

and

potential

losses

in

excess

of

the

fund’s

initial

investment.

During

the

six

months ended

November

30,

2022,

the

volume

of

the

fund’s

activity

in

swaps,

based

on

underlying

notional

amounts,

was

generally

between

5%

and

6%

of

net

assets.

NOTE

4

-

OTHER

INVESTMENT

TRANSACTIONS 

Consistent

with

its

investment

objective,

the

fund

engages

in

the

following

practices

to

manage

exposure

to

certain

risks

and/or

to

enhance

performance.

The

investment

objective,

policies,

program,

and

risk

factors

of

the

fund

are

described

more

fully

in

the

fund’s

prospectus

and

Statement

of

Additional

Information.

Restricted

Securities

 The

fund

invests

in

securities

that

are

subject

to

legal

or

contractual

restrictions

on

resale.

Prompt

sale

of

such

securities

at

an

acceptable

price

may

be

difficult

and

may

involve

substantial

delays

and

additional

costs.

Collateralized

Loan

Obligations 

 The

fund

invests

in

collateralized

loan

obligations

(CLOs)

which

are

entities

backed

by

a

diversified

pool

of

syndicated

bank

loans.

The

cash

flows

of

the

CLO

can

be

split

into

multiple

segments,

called

“tranches”

or

“classes”,

which

will

vary

in

risk

profile

and

yield.

The

riskiest

segments,

which

are

the

subordinate

or

“equity”

tranches,

bear

the

greatest

risk

of

loss

from

defaults

in

the

underlying

assets

of

the

CLO

and

serve

to

protect

the

other,

more

senior,

tranches.

Senior

tranches

will

typically

have

higher

credit

ratings

and

lower

yields

than

the

securities

underlying

the

CLO.

Despite

the

protection

from

the

more

junior

tranches,

senior

tranches

can

experience

substantial

losses. 

Mortgage-Backed

Securities

 The

fund

invests

in

mortgage-backed

securities

(MBS

or

pass-through

certificates)

that

represent

an

interest

in

a

pool

of

specific

underlying

mortgage

loans

and

entitle

the

fund

to

the

periodic

payments

of

principal

and

interest

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

63

from

those

mortgages.

MBS

may

be

issued

by

government

agencies

or

corporations,

or

private

issuers.

Most

MBS

issued

by

government

agencies

are

guaranteed;

however,

the

degree

of

protection

differs

based

on

the

issuer.

MBS are

sensitive

to

changes

in

economic

conditions

that

affect

the

rate

of

prepayments

and

defaults

on

the

underlying

mortgages;

accordingly,

the

value,

income,

and

related

cash

flows

from

MBS

may

be

more

volatile

than

other

debt

instruments.

LIBOR

Transition

 The fund

may

invest

in

instruments

that

are

tied

to

reference

rates,

including

LIBOR.

Over

the

course

of

the

last

several

years,

global

regulators

have

indicated

an

intent

to

phase

out

the

use

of

LIBOR

and

similar

interbank

offered

rates

(IBOR).

While

publication

for

most

LIBOR

currencies

and

lesser-used

USD

LIBOR

settings

ceased

immediately

after

December

31,

2021,

remaining

USD

LIBOR

settings

will

continue

to

be

published

until

June

30,

2023.

There

remains

uncertainty

regarding

the

future

utilization

of

LIBOR

and

the

nature

of

any

replacement

rate.

Any

potential

effects

of

the

transition

away

from

LIBOR

on

the fund,

or

on

certain

instruments

in

which

the fund

invests,

cannot

yet

be

determined.

The

transition

process

may

result

in,

among

other

things,

an

increase

in

volatility

or

illiquidity

of

markets

for

instruments

that

currently

rely

on

LIBOR,

a

reduction

in

the

value

of

certain

instruments

held

by

the fund,

or

a

reduction

in

the

effectiveness

of

related

fund

transactions

such

as

hedges.

Any

such

effects

could

have

an

adverse

impact

on

the fund's

performance.

Securities

Lending

 The fund

may

lend

its

securities

to

approved

borrowers

to

earn

additional

income.

Its

securities

lending

activities

are

administered

by

a

lending

agent

in

accordance

with

a

securities

lending

agreement.

Security

loans

generally

do

not

have

stated

maturity

dates,

and

the

fund

may

recall

a

security

at

any

time.

The

fund

receives

collateral

in

the

form

of

cash

or

U.S.

government

securities.

Collateral

is

maintained

over

the

life

of

the

loan

in

an

amount

not

less

than

the

value

of

loaned

securities;

any

additional

collateral

required

due

to

changes

in

security

values

is

delivered

to

the

fund

the

next

business

day.

Cash

collateral

is

invested

in

accordance

with

investment

guidelines

approved

by

fund

management.

Additionally,

the

lending

agent

indemnifies

the

fund

against

losses

resulting

from

borrower

default.

Although

risk

is

mitigated

by

the

collateral

and

indemnification,

the

fund

could

experience

a

delay

in

recovering

its

securities

and

a

possible

loss

of

income

or

value

if

the

borrower

fails

to

return

the

securities,

collateral

investments

decline

in

value,

and

the

lending

agent

fails

to

perform.

Securities

lending

revenue

consists

of

earnings

on

invested

collateral

and

borrowing

fees,

net

of

any

rebates

to

the

borrower,

compensation

to

the

lending

agent,

and

other

administrative

costs.

In

accordance

with

GAAP,

investments

made

with

cash

collateral

T.

ROWE

PRICE

Ultra

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Fund

64

are

reflected

in

the

accompanying

financial

statements,

but

collateral

received

in

the

form

of

securities

is

not.

At

November

30,

2022,

the

value

of

loaned

securities

was

$1,123,000;

the

value

of

cash

collateral

and

related

investments

was

$1,152,000.

Other 

Purchases

and

sales

of

portfolio

securities

other

than

short-term and

U.S.

government

securities

aggregated $400,500,000 and

$785,710,000,

respectively,

for

the

six

months ended

November

30,

2022.

Purchases

and

sales

of

U.S.

government

securities

aggregated

$2,240,000 and

$99,209,000,

respectively,

for

the

six

months ended

November

30,

2022.

NOTE

5

-

FEDERAL

INCOME

TAXES

No

provision

for

federal

income

taxes

is

required

since

the

fund

intends

to

continue

to

qualify

as

a

regulated

investment

company

under

Subchapter

M

of

the

Internal

Revenue

Code

and

distribute

to

shareholders

all

of

its

taxable

income

and

gains.

Distributions

determined

in

accordance

with

federal

income

tax

regulations

may

differ

in

amount

or

character

from

net

investment

income

and

realized

gains

for

financial

reporting

purposes.

Financial

reporting

records

are

adjusted

for

permanent

book/tax

differences

to

reflect

tax

character

but

are

not

adjusted

for

temporary

differences.

The

amount

and

character

of

tax-basis

distributions

and

composition

of

net

assets

are

finalized

at

fiscal

year-end;

accordingly,

tax-basis

balances

have

not

been

determined

as

of

the

date

of

this

report.

At

November

30,

2022,

the

cost

of

investments

for

federal

income

tax

purposes

was

$3,021,394,000.

Net

unrealized

loss

aggregated

$108,963,000

at

period-end,

of

which $1,284,000

related

to

appreciated

investments

and $110,247,000

related

to

depreciated

investments. 

NOTE

6

-

RELATED

PARTY

TRANSACTIONS

The

fund

is

managed

by

T.

Rowe

Price

Associates,

Inc.

(Price

Associates),

a

wholly

owned

subsidiary

of

T.

Rowe

Price

Group,

Inc.

(Price

Group). Price

Associates

has

entered

into

a

sub-advisory

agreement(s)

with

one

or

more

of

its

wholly

owned

subsidiaries,

to

provide

investment

advisory

services

to

the

fund. 

The

investment

management

agreement

between

the

fund

and

Price

Associates

provides

for

an

annual

investment

management

fee

equal

to 0.16%

of

the

fund’s

average

daily

net

assets.

The

fee

is

computed

daily

and

paid

monthly.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

65

The Investor Class

is

subject

to

a

contractual

expense

limitation

through

the

expense

limitation

date

indicated

in

the

table

below.

Prior

to

October

1,

2021,

the

Investor Class’s

contractual

expense

limitation

was

0.35%.

During

the

limitation

period,

Price

Associates

is

required

to

waive

its

management

fee

or

pay

any

expenses

(excluding

interest;

expenses

related

to

borrowings,

taxes,

and

brokerage;

non-recurring,

extraordinary expenses;

and

acquired

fund

fees

and

expenses) that

would

otherwise

cause

the

class’s

ratio

of

annualized

total

expenses

to

average

net

assets

(net

expense

ratio)

to

exceed

its

expense

limitation.

The

class

is

required

to

repay

Price

Associates

for

expenses

previously

waived/paid

to

the

extent

the

class’s

net

assets

grow

or

expenses

decline

sufficiently

to

allow

repayment

without

causing

the

class’s

net

expense

ratio

(after

the

repayment

is

taken

into

account)

to

exceed

the

lesser

of:

(1)

the

expense

limitation

in

place

at

the

time

such

amounts

were

waived;

or

(2)

the

class’s

current

expense

limitation.

However,

no

repayment

will

be

made

more

than

three

years

after

the

date

of

a

payment

or

waiver.

The

I

Class

is

also

subject

to

an

operating

expense

limitation

(I

Class

Limit)

pursuant

to

which

Price

Associates

is

contractually

required

to

pay

all

operating

expenses

of

the

I

Class,

excluding

management

fees;

interest;

expenses

related

to

borrowings,

taxes,

and

brokerage; non-recurring,

extraordinary expenses; and

acquired

fund

fees

and

expenses, to

the

extent

such

operating

expenses,

on

an

annualized

basis,

exceed

the

I

Class

Limit. This

agreement

will

continue

through

the

expense

limitation

date

indicated

in

the

table

below,

and

may

be

renewed,

revised,

or

revoked

only

with

approval

of

the

fund’s

Board.

The

I

Class

is

required

to

repay

Price

Associates

for

expenses

previously

paid

to

the

extent

the

class’s

net

assets

grow

or

expenses

decline

sufficiently

to

allow

repayment

without

causing

the

class’s

operating

expenses

(after

the

repayment

is

taken

into

account)

to

exceed

the

lesser

of:

(1)

the

I

Class

Limit

in

place

at

the

time

such

amounts

were

paid;

or

(2)

the

current

I

Class

Limit.

However,

no

repayment

will

be

made

more

than

three

years

after

the

date

of

a

payment

or

waiver.

The

Z

Class

is

also

subject

to

a

contractual

expense

limitation

agreement

whereby

Price

Associates

has

agreed

to

waive

and/or

bear

all

of

the

Z

Class’

expenses

(excluding

interest;

expenses

related

to

borrowings,

taxes,

and

brokerage;

non-recurring,

extraordinary

expenses;

and

acquired

fund

fees

and

expenses)

in

their

entirety.

This

fee

waiver

and/or

expense

reimbursement

arrangement

is

expected

to

remain

in

place

indefinitely,

and

the

agreement

may

only

be

amended

or

terminated

with

approval

by

the

fund’s

Board.

Expenses

of

the

fund

waived/paid

by

the

manager

are

not

subject

to

later

repayment

by

the

fund.

Pursuant

to

these

agreements,

expenses

were

waived/paid

by

and/or

repaid

to

Price

Associates

during

the

six

months ended November

30,

2022

as

indicated

in

the

table

below.

Including

this

amount,

expenses

previously

waived/paid

by

Price

Associates

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

66

in

the

amount

of $441,000 remain

subject

to

repayment

by

the

fund

at

November

30,

2022.

Any

repayment

of

expenses

previously

waived/paid

by

Price

Associates

during

the

period

would

be

included

in

the

net

investment

income

and

expense

ratios

presented

on

the

accompanying

Financial

Highlights.

In

addition,

the

fund

has

entered

into

service

agreements

with

Price

Associates

and

two

wholly

owned

subsidiaries

of

Price

Associates,

each

an

affiliate

of

the

fund

(collectively,

Price).

Price

Associates

provides

certain

accounting

and

administrative

services

to

the

fund.

T.

Rowe

Price

Services,

Inc.

provides

shareholder

and

administrative

services

in

its

capacity

as

the

fund’s

transfer

and

dividend-disbursing

agent.

T.

Rowe

Price

Retirement

Plan

Services,

Inc.

provides

subaccounting

and

recordkeeping

services

for

certain

retirement

accounts

invested

in

the

Investor

Class.

For

the

six

months ended

November

30,

2022,

expenses

incurred

pursuant

to

these

service

agreements

were

$50,000 for

Price

Associates;

$206,000 for

T.

Rowe

Price

Services,

Inc.;

and

$3,000 for

T.

Rowe

Price

Retirement

Plan

Services,

Inc.

All

amounts

due

to

and

due

from

Price,

exclusive

of

investment

management

fees

payable,

are

presented

net

on

the

accompanying

Statement

of

Assets

and

Liabilities.

The fund

may

invest

its

cash

reserves

in

certain

open-end

management

investment

companies

managed

by

Price

Associates

and

considered

affiliates

of

the

fund:

the

T.

Rowe

Price

Government

Reserve

Fund

or

the

T.

Rowe

Price

Treasury

Reserve

Fund,

organized

as

money

market

funds (together,

the

Price

Reserve

Funds).

The

Price

Reserve

Funds

are

offered

as

short-term

investment

options

to

mutual

funds,

trusts,

and

other

accounts

managed

by

Price

Associates

or

its

affiliates

and

are

not

available

for

direct

purchase

by

members

of

the

public.

Cash

collateral

from

securities

lending,

if

any,

is

invested

in

the

T.

Rowe

Price

Government

Reserve Fund. The

Price

Reserve

Funds

pay

no

investment

management

fees.

As

of

November

30,

2022,

T.

Rowe

Price

Group,

Inc.,

or

its

wholly

owned

subsidiaries,

owned

891,069

shares

of

the

Investor

Class,

representing

less

than

1%

of

the

Investor

Class's

net

assets,

3,392,563

shares

of

the

I

Class,

representing

2%

of

the

I

Class's

net

assets,

and

19,608

shares

of

the

Z

Class,

representing

100%

of

the

Z

Class's

net

assets. 

Investor

Class

I

Class

Z

Class

Expense

limitation/I

Class

Limit

0.31%

0.05%

0.00%

Expense

limitation

date

09/30/23

09/30/23

N/A

(Waived)/repaid

during

the

period

($000s)

$(241)

$—

$—

(1)

(1)

Amount

rounds

to

less

than

$1,000

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

67

The

fund may

participate

in

securities

purchase

and

sale

transactions

with

other

funds

or

accounts

advised

by

Price

Associates

(cross

trades),

in

accordance

with

procedures

adopted

by the

fund’s

Board

and

Securities

and

Exchange

Commission

rules,

which

require,

among

other

things,

that

such

purchase

and

sale

cross

trades

be

effected

at

the

independent

current

market

price

of

the

security.

During

the

six

months ended

November

30,

2022,

the

fund

had

no

purchases

or

sales

cross

trades

with

other

funds

or

accounts

advised

by

Price

Associates.

NOTE

7

-

OTHER

MATTERS

Unpredictable

events

such

as

environmental

or

natural

disasters,

war,

terrorism,

pandemics,

outbreaks

of

infectious

diseases,

and

similar

public

health

threats

may

significantly

affect

the

economy

and

the

markets

and

issuers

in

which

a

fund

invests.

Certain

events

may

cause

instability

across

global

markets,

including

reduced

liquidity

and

disruptions

in

trading

markets,

while

some

events

may

affect

certain

geographic

regions,

countries,

sectors,

and

industries

more

significantly

than

others,

and

exacerbate

other

pre-existing

political,

social,

and

economic

risks.

Since

2020,

a

novel

strain

of

coronavirus

(COVID-19)

has

resulted

in

disruptions

to

global

business

activity

and

caused

significant

volatility

and

declines

in

global

financial

markets.

In

February

2022,

Russian

forces

entered

Ukraine

and

commenced

an

armed

conflict

leading

to

economic

sanctions

being

imposed

on

Russia

and

certain

of

its

citizens,

creating

impacts

on

Russian-related

stocks

and

debt

and

greater

volatility

in

global

markets.

These

are

recent

examples

of

global

events

which

may

have

a

negative

impact

on

the

values

of

certain

portfolio

holdings

or

the

fund’s

overall

performance.

Management

is

actively

monitoring

the

risks

and

financial

impacts

arising

from

these

events.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

68

INFORMATION

ON

PROXY

VOTING

POLICIES,

PROCEDURES,

AND

RECORDS

A

description

of

the

policies

and

procedures

used

by

T.

Rowe

Price

funds

to

determine

how

to

vote

proxies

relating

to

portfolio

securities

is

available

in

each

fund’s

Statement

of

Additional

Information.

You

may

request

this

document

by

calling

1-800-225-5132

or

by

accessing

the

SEC’s

website,

sec.gov.

The

description

of

our

proxy

voting

policies

and

procedures

is

also

available

on

our

corporate

website.

To

access

it,

please

visit

the

following

Web

page:

https://www.troweprice.com/corporate/us/en/utility/policies.html

Scroll

down

to

the

section

near

the

bottom

of

the

page

that

says,

“Proxy

Voting

Guidelines.”

Click

on

the

links

in

the

shaded

box.

Each

fund’s

most

recent

annual

proxy

voting

record

is

available

on

our

website

and

through

the

SEC’s

website.

To

access

it

through

T.

Rowe

Price,

visit

the

website

location

shown

above,

and

scroll

down

to

the

section

near

the

bottom

of

the

page

that

says,

“Proxy

Voting

Records.”

Click

on

the

Proxy

Voting

Records

link

in

the

shaded

box.

HOW

TO

OBTAIN

QUARTERLY

PORTFOLIO

HOLDINGS

The

fund

files

a

complete

schedule

of

portfolio

holdings

with

the

Securities

and

Exchange

Commission

(SEC)

for

the

first

and

third

quarters

of

each

fiscal

year

as

an

exhibit

to

its

reports

on

Form

N-PORT.

The

fund’s

reports

on

Form

N-PORT

are

available

electronically

on

the

SEC’s

website

(sec.gov).

In

addition,

most

T.

Rowe

Price

funds

disclose

their

first

and

third

fiscal

quarter-end

holdings

on

troweprice.com

.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

69

APPROVAL

OF

SUBADVISORY

AGREEMENT

At

a

meeting

held

on

July

25,

2022

(Meeting),

the

fund’s

Board

of

Directors

(Board)

considered

the

initial

approval

of

an

investment

subadvisory

agreement

(Subadvisory

Contract)

that

T.

Rowe

Price

Associates,

Inc.

(Adviser),

entered

into

with

T.

Rowe

Price

International

Ltd

(Subadviser)

on

behalf

of

the

fund.

The

Subadvisory

Contract

authorizes

the

Subadviser

to

have

investment

discretion

with

respect

to

all

or

a

portion

of

the

fund’s

portfolio.

The

Board

noted

that

the

Subadvisory

Contract

will

be

substantially

similar

to

other

subadvisory

agreements

that

are

in

place

for

other

T.

Rowe

Price

funds

that

delegate

investment

management

responsibilities

to

affiliated

investment

advisers

and

that

the

Adviser

will

retain

oversight

responsibilities

with

respect

to

the

fund.

The

Board

also

noted

that

the

new

subadvisory

arrangement

will

not

change

the

total

advisory

fees

paid

by

the

fund.

However,

under

the

Subadvisory

Contract,

the

Adviser

may

pay

the

Subadviser

up

to

60%

of

the

advisory

fees

that

the

Adviser

receives

from

the

fund.

At

the

Meeting,

the

Board

reviewed

materials

relevant

to

its

consideration

of

the

proposed

Subadvisory

Contract.

Each

year,

the

Board

considers

the

continuation

of

the

investment

management

agreement

(Advisory

Contract)

between

the

fund

and

the

Adviser.

The

fund’s

Advisory

Contract

was

most

recently

approved

by

the

Board

at

a

meeting

held

on

March

7–8,

2022

(March

Meeting).

A

discussion

of

the

basis

for

the

Board’s

approval

of

the

Advisory

Contract

is

included

in

the

fund’s

annual

shareholder

report

for

the

period

ended

May

31,

2022.

The

factors

considered

by

the

Board

at

the

Meeting

in

connection

with

approval

of

the

proposed

Subadvisory

Contract

were

substantially

similar

to

the

factors

considered

at

the

March

Meeting

in

connection

with

the

approval

to

continue

the

Advisory

Contract.

The

independent

directors

were

assisted

in

their

evaluation

of

the

Subadvisory

Contract

by

independent

legal

counsel

from

whom

they

received

separate

legal

advice

and

with

whom

they

met

separately.

Following

discussion

at

the

Meeting,

the

Board,

including

all

of

the

fund’s

independent

directors,

approved

the

Subadvisory

Contract

between

the

Adviser

and

Subadviser

on

behalf

of

the

fund.

No

single

factor

was

considered

in

isolation

or

to

be

determinative

to

the

decision.

Rather,

the

Board

concluded,

in

light

of

a

weighting

and

balancing

of

all

factors

considered,

that

it

was

in

the

best

interests

of

the

fund

and

its

shareholders

for

the

Board

to

approve

the

Subadvisory

Contract

effective

September

1,

2022.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

70

LIQUIDITY

RISK

MANAGEMENT

PROGRAM

In

accordance

with

Rule

22e-4

(Liquidity

Rule)

under

the

Investment

Company

Act

of

1940,

as

amended,

the

fund

has

established

a

liquidity

risk

management

program

(Liquidity

Program)

reasonably

designed

to

assess

and

manage

the

fund’s

liquidity

risk,

which

generally

represents

the

risk

that

the

fund

would

not

be

able

to

meet

redemption

requests

without

significant

dilution

of

remaining

investors’

interests

in

the

fund.

The

fund’s

Board

of

Directors

(Board)

has

appointed

the

fund’s

investment

adviser,

T.

Rowe

Price

Associates,

Inc.

(Adviser),

as

the

administrator

of

the

Liquidity

Program.

As

administrator,

the

Adviser

is

responsible

for

overseeing

the

day-to-day

operations

of

the

Liquidity

Program

and,

among

other

things,

is

responsible

for

assessing,

managing,

and

reviewing

with

the

Board

at

least

annually

the

liquidity

risk

of

each

T.

Rowe

Price

fund.

The

Adviser

has

delegated

oversight

of

the

Liquidity

Program

to

a

Liquidity

Risk

Committee

(LRC),

which

is

a

cross-functional

committee

composed

of

personnel

from

multiple

departments

within

the

Adviser.

The

Liquidity

Program’s

principal

objectives

include

supporting

the

T.

Rowe

Price

funds’

compliance

with

limits

on

investments

in

illiquid

assets

and

mitigating

the

risk

that

the

fund

will

be

unable

to

timely

meet

its

redemption

obligations.

The

Liquidity

Program

also

includes

a

number

of

elements

that

support

the

management

and

assessment

of

liquidity

risk,

including

an

annual

assessment

of

factors

that

influence

the

fund’s

liquidity

and

the

periodic

classification

and

reclassification

of

a

fund’s

investments

into

categories

that

reflect

the

LRC’s

assessment

of

their

relative

liquidity

under

current

market

conditions.

Under

the

Liquidity

Program,

every

investment

held

by

the

fund

is

classified

at

least

monthly

into

one

of

four

liquidity

categories

based

on

estimations

of

the

investment’s

ability

to

be

sold

during

designated

time

frames

in

current

market

conditions

without

significantly

changing

the

investment’s

market

value.

As

required

by

the

Liquidity

Rule,

at

a

meeting

held

on

July

25,

2022,

the

Board

was

presented

with

an

annual

assessment

prepared

by

the

LRC,

on

behalf

of

the

Adviser,

that

addressed

the

operation

of

the

Liquidity

Program

and

assessed

its

adequacy

and

effectiveness

of

implementation,

including

any

material

changes

to

the

Liquidity

Program

and

the

determination

of

each

fund’s

Highly

Liquid

Investment

Minimum

(HLIM).

The

annual

assessment

included

consideration

of

the

following

factors,

as

applicable:

the

fund’s

investment

strategy

and

liquidity

of

portfolio

investments

during

normal

and

reasonably

foreseeable

stressed

conditions,

including

whether

the

investment

strategy

is

appropriate

for

an

open-end

fund,

the

extent

to

which

the

strategy

involves

a

relatively

concentrated

portfolio

or

large

positions

in

particular

issuers,

and

the

use

of

borrowings

for

investment

purposes

and

derivatives;

short-term

and

long-term

cash

flow

projections

covering

both

normal

and

reasonably

foreseeable

stressed

conditions;

and

holdings

of

cash

and

cash

equivalents,

as

well

as

available

borrowing

arrangements.

T.

ROWE

PRICE

Ultra

Short-Term

Bond

Fund

71

For

the

fund

and

other

T.

Rowe

Price

funds,

the

annual

assessment

incorporated

a

report

related

to

a

fund’s

holdings,

shareholder

and

portfolio

concentration,

any

borrowings

during

the

period,

cash

flow

projections,

and

other

relevant

data

for

the

period

of

April

1,

2021,

through

March

31,

2022.

The

report

described

the

methodology

for

classifying

a

fund’s

investments

(including

any

derivative

transactions)

into

one

of

four

liquidity

categories,

as

well

as

the

percentage

of

a

fund’s

investments

assigned

to

each

category.

It

also

explained

the

methodology

for

establishing

a

fund’s

HLIM

and

noted

that

the

LRC

reviews

the

HLIM

assigned

to

each

fund

no

less

frequently

than

annually.

During

the

period

covered

by

the

annual

assessment,

the

LRC

has

concluded,

and

reported

to

the

Board,

that

the

Liquidity

Program

continues

to

operate

adequately

and

effectively

and

is

reasonably

designed

to

assess

and

manage

the

fund’s

liquidity

risk.

LIQUIDITY

RISK

MANAGEMENT

PROGRAM

(continued)

T.

Rowe

Price

Investment

Services,

Inc.

|

100

East

Pratt

Street

|

Baltimore,

MD

21202-1009

You

have

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Explore

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®

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COLLEGE

SAVINGS

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Price-managed

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Visit

troweprice.com/broadrange

Call

1-800-225-5132

to

request

a

prospectus

or

summary

prospectus;

each

includes

investment

objectives,

risks,

fees,

expenses,

and

other

information

that

you

should

read

and

consider

carefully

before

investing.

All

mutual

funds

are

subject

to

market

risk,

including

possible

loss

of

principal.

Investing

internationally

involves

special

risks

including

economic

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1

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T.

Rowe

Price

®

ActivePlus

Portfolios

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a

discretionary

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management

program

provided

by

T.

Rowe

Price

Advisory

Services,

Inc.,

a

registered

investment

adviser

under

the

Investment

Advisers

Act

of

1940.

Brokerage

services

are

provided

by

T.

Rowe

Price

Investment

Services,

Inc.,

member

FINRA/SIPC.

Brokerage

accounts

are

carried

by

Pershing

LLC,

a

BNY

Mellon

Company,

member

NYSE/FINRA/SIPC.

T.

Rowe

Price

Advisory

Services,

Inc.,

and

T.

Rowe

Price

Investment

Services,

Inc.,

are

affiliated

companies.

2

Brokerage

services

are

provided

by

T.

Rowe

Price

Investment

Services,

Inc.,

member

FINRA/SIPC.

Brokerage

accounts

are

carried

by

Pershing

LLC,

a

BNY

Mellon

Company,

member

NYSE/FINRA/SIPC.

202301-2568436

F188-051

1/23

Item 1. (b) Notice pursuant to Rule 30e-3.

Not applicable.

Item 2.   Code of Ethics.

A code of ethics, as defined in Item 2 of Form N-CSR, applicable to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions is filed as an exhibit to the registrant’s annual Form N-CSR. No substantive amendments were approved or waivers were granted to this code of ethics during the registrant’s most recent fiscal half-year.

Item 3.   Audit Committee Financial Expert.

Disclosure required in registrant’s annual Form N-CSR.

Item 4.   Principal Accountant Fees and Services.

Disclosure required in registrant’s annual Form N-CSR.

Item 5.   Audit Committee of Listed Registrants.

Not applicable.

Item 6.   Investments.

(a)  Not applicable. The complete schedule of investments is included in Item 1 of this Form N-CSR.

(b)  Not applicable.

Item 7.   Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable.

Item 8.   Portfolio Managers of Closed-End Management Investment Companies.

Not applicable.

Item 9.   Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders.

There has been no change to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.

Item 11. Controls and Procedures.

(a)  The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures within 90 days of this filing and have concluded that the registrant’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-CSR was recorded, processed, summarized, and reported timely.

(b)  The registrant’s principal executive officer and principal financial officer are aware of no change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.

Not applicable.

Item 13. Exhibits.

(a)(1)	The registrant’s code of ethics pursuant to Item 2 of Form N-CSR is filed with the registrant’s annual Form N-CSR.
(2)	Separate certifications by the registrant’s principal executive officer and principal financial officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and required by Rule 30a-2(a) under the Investment Company Act of 1940, are attached.
(3)	Written solicitation to repurchase securities issued by closed-end companies: not applicable.
(b)	A certification by the registrant’s principal executive officer and principal financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and required by Rule 30a-2(b) under the Investment Company Act of 1940, is attached.

SIGNATURES

 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

T. Rowe Price Short-Term Bond Fund, Inc.
By	/s/ David Oestreicher
	David Oestreicher
	Principal Executive Officer
Date	January 19, 2023

 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By	/s/ David Oestreicher
	David Oestreicher
	Principal Executive Officer
Date	January 19, 2023
By	/s/ Alan S. Dupski
	Alan S. Dupski
	Principal Financial Officer
Date	January 19, 2023