A big move down in the price of gold, having nothing to do with the inflation outlook, nonetheless triggered a rally on light volume in the Treasury market this morning.

The benchmark 30-year Treasury bond, which traded in a very narrow range for the first hour and a half of the day, popped nearly half a point into positive territory after a sharp drop in the price of gold. It lately was up 16/32 at 96 17/32, dropping its yield 3 basis points to 5.49%. Volume continues to be light, though -- 41.2% below average for a first-quarter Tuesday by 10 a.m., according to tracker

GovPX

.

Gold dropped after

President Clinton

, at a meeting in Washington, said the U.S. supports gold sales by the

International Monetary Fund

to help fund debt relief for poor countries. The April gold contract traded on the

New York Mercantile Exchange

hit an intraday low of 282. It last closed below that level Aug. 28.

The drop in gold "led to some buying and short-covering" as the Treasury futures contract traded on the

Chicago Board of Trade

rose to the key 122 level, said Walter Burke, senior technical analyst at

MCM Moneywatch

. The contract lately was trading at 122 20/32, up 9/32.

The action in bonds looks foolish to a commodities expert. "What's happening in gold has nothing to do with what should affect bonds -- fear of another disinflationary spiral," said Dinsa Mehta, managing director in commodities at

Chase

. Rather, "It's another chapter in the move we've been seeing for the last two or three years in gold reserve disposals."

The fact that the IMF is the world's second-largest holder of gold reserves "adds legitimacy to concerns of central-bank selling," Mehta said, adding: "If they're buying bonds on this, good luck to them."