NEW YORK, JULY 8 -- Bond prices fell in mostly light, lethargic trading today finishing near their lows of the day.
The Treasury's closely watched 30-year bond dropped about 7/8 point, or $8.75 per $1,000 in face value. Its yield jumped to 8.45 percent from 8.39 percent late Tuesday.
Corporate and municipal bonds were mostly lower.
Analysts said bond prices tracked movements of the dollar on world currency markets early in the trading session, but later drifted downward without an apparent stimulus.
"The bond market is in the doldrums," said Marshall Front, an economist for the investment firm Stein Roe & Farnham in Chicago.
On Tuesday, the U.S. currency topped the psychologically important level of 150 Japanese yen for the first time in more than three months. It was higher in overseas trading today, but fell slightly in domestic trading and finished mixed late in the day.
Bond prices fell sharply earlier this year on speculation that a weak dollar would bring higher inflation and reduce the strong foreign demand for U.S. securities.
The dollar in recent weeks has strengthened -- and bonds generally have followed -- because of market sentiment that the central banks of major industrialized nations would intervene to prevent the currency from moving lower. At the same time, the dollar has held a relatively narrow trading range because of speculation that the central banks would move to depress the currency if its value rose too far.
Continued testimony today by Lt. Col. Oliver L. North Jr. at a congressional hearing on the Iran-Contra affair had little impact on the bond market, traders said. Bond prices were boosted Tuesday by North's testimony because it appeared to remove responsibility from President Reagan for the diversion of funds from arms sales to Iran for use by rebels in Nicaragua.
Today'ss government report that Americans paid off $560 million more in credit than they borrowed during May, the first reduction in consumer debt in nearly five years, was also shrugged off by the bond market, said Maria Ramirez, an analyst for investment firm Drexel Burnham Lambert Inc.
In the secondary market for Treasury bonds, prices of short-term government issues finished 1/8 point lower to 1/16 point higher, intermediate maturities fell 5/32 point to 1/2 point and 20-year issues lost 25/32 point, according to the investment firm Salomon Brothers Inc.
The movement of a point is equivalent to a change of $10 in the price of a bond with a $1,000 face value.
The Merrill Lynch Daily Treasury Index, which measures price movements on all outstanding Treasury issues with maturities of a year or longer, fell 0.28 to 112.83. The Shearson Lehman Daily Treasury Bond Index, which makes a similar measurement, was down 2.48 at 1,180.60.
In corporate trading, industrial issues and utilities declined 3/8 point in light activity, according to Salomon Brothers.
Moody's Investment Grade Corporate Bond Index, which measures price movements on 100 corporate bonds with maturities of five years or longer, edged up 0.18 to 264.77.
Among tax-exempt municipal bonds, general obligations rose 1/8 point and dollar bonds fell 1/8 point in light trading, Salomon Brothers said.
Yields on three-month Treasury bills slipped 1 basis point to 5.58 percent. A basis point is one-hundredth of a percentage point. Six-month bills dropped 13 basis points to 5.43 percent and one-year bills were unchanged at 6.20 percent.