NEW YORK — Bond prices fell sharply Tuesday, pushing yields on long-term Treasury bonds to their highest levels in 18 months, as inflation fears were fanned by a continuing decline in the dollar and rising gold prices.
The Treasury's 30-year bond fell 1 1/8 point, or $11.25 for every $1,000 in face value. Its yield climbed to 9.27% from 9.16% late Monday.
The yield on 30-year Treasury bonds has not been that high since February, 1986, according to William Griggs, managing director of the investment firm Griggs & Santow Inc.
Griggs and other analysts said bond traders viewed the movements in the dollar and gold as an indication that inflation could accelerate, a development that would erode the value of fixed-income investments.