As the dollar continued drifting to new lows on world currency markets yesterday, the White House said President Reagan is "not seeking" a decline in the U.S. currency.

In Tokyo, where trading ends before Europe's business day begins, the dollar fell to a low of 127.90 yen before closing at 128, down 0.75 yen from Friday. The close was the lowest since dollar-yen exchange rates were set in the late 1940s.

{The Associated Press reported from Tokyo that the dollar opened at 128.02 yen Tuesday, then fell to 127.65 yen at midmorning.}

By the time the markets closed in New York yesterday, the dollar was at 128 yen and 1.6305 West German marks, down from 128.30 yen and 1.6307 marks on Friday.

Meanwhile, gold topped $500 an ounce in Europe for the first time in nearly seven years, ending at $500.50 in Zurich, up from Friday's $493.50.

White House spokesman Marlin Fitzwater, replying to reporters' questions about European concerns that the administration was willing to permit a "free fall" of the dollar, repeated a statement made by President Reagan in mid-November.

Reading that statement, which boosted the dollar at the time, Fitzwater said, "We are not seeking a decline in the dollar. We and our major allies are in the process of strengthening our policies in a coordinated fashion in order to provide a basis for stable exchange rates."

Fitzwater had no comment on a statement by former Federal Reserve chairman Paul A. Volcker to the effect that the dollar had fallen too far, reviving concerns about inflation.

Fitzwater's comment at least appeared to bring the dollar back up fractionally from the worst prices of the day -- although, as one dealer in London put it, "No one really believed it. You need to see firm intervention by the Federal Reserve to really boost the dollar."

Most market observers said European central banks were not resisting the continued decline, which came in light trading, and that intervention by the Bank of Japan did not come until late in the day, and then only to slow the process.

Traders predicted that the dollar's slide would continue until the U.S. trade deficit begins to show improvement or until the major countries -- perhaps at a Group of Seven meeting -- offer convincing evidence that they intend and have the means to stabilize the dollar.

Until that happens, several experts said, the dollar will continue to slip toward 120 yen and 1.50 marks.

A senior Japanese official indicated the finance ministers and central bankers of the seven -- the United States, Japan, West Germany, France, Italy, Canada and Britain -- will not meet before the end of the year.

All sides agree that a G-7 meeting cannot be held before completion of the U.S. deficit reduction package. Treasury Secretary James A. Baker III yesterday was negotiating with congressional leaders on details of that package, working against a Wednesday midnight deadline.

But even if the package is finished by then, Japanese officials have indicated it is unlikely that a meeting can be held during the remaining few days of December.

However, a meeting in a 10-day period beginning Jan. 4 after the Japanese holiday season is a possibility, a Japanese source said -- assuming that all officials conclude that calling a meeting is less risky to market expectations than not having one.