CREDIT : Bond Prices Get Big Lift From Stronger Dollar

Bond prices rose sharply in moderate trading Monday, helped by a stronger dollar and falling crude oil prices.

The Treasury’s closely watched 30-year bond gained 21/32 point, or about $6.50 per $1,000 face amount, after losing $2.50 in early trading.

Its yield declined to 8.74% from 8.80% late Friday.

Bond prices started out weak, pushed down by a lower dollar in overseas trading, mostly in London and Tokyo, analysts said.

Jay Goldinger, who runs the Beverly Hills-based investment firm Capital Insight Inc., said traders dumped bonds in early dealings in reaction to the dollar’s softness in foreign exchange markets, but interest was rekindled after reports that the Federal Reserve intervened to support the dollar.

In the secondary market for Treasury bonds, prices of short-term government issues were 1/32 point to 3/32 point higher, intermediate maturities rose 5/32 point to point, and long-term issues gained 23/32 point, according Telerate Inc., a financial information service.

Corporate bonds also advanced, despite some concern about takeover issues. Moody’s investment grade corporate bond index, which measures price movements on 80 corporate bonds with maturities of five years or longer, rose 1.96 to 297.41.

The federal funds rate, the interest on overnight loans between banks, rose to 8.313% from 8.25% late Friday.