NEW YORK (AP) _ Treasury bond prices tumbled Wednesday amid diminishing hopes that the Federal Reserve was preparing to ease interest rates.

The price of the Treasury's bellwether 30-year bond was down 1 1-32 point, or $10.31 cents per $1,000 in face amount. Its yield, which rises when prices drop, jumped to 7.91 percent from 7.82 percent late Tuesday.

Shorter-term securities sustained slight to modest declines.

Traders said they sold bonds after the Fed drained reserves from the banking system, signaling it was not pushing down the federal funds rate.

The federal funds rate is the interest on overnight loans commonly made between banks and is a scrutinized indicator of the Fed's intentions.

The rate had fallen on Tuesday, and traders speculated that may have signaled a 1/4 percentage point drop in the target for the rate, believed now to be at 5 1/4 percent.

The rate on Wednesday settled at 5 percent, but the level was not seen as reflecting a new Fed target.

''The fact the Fed came in and drained reserves really put a dent in some participants' hopes that another easing was right around the corner,'' said Maria Ramirez, chief executive of Ramirez Capital Consultants Inc. in New York.

Recent developments have raised fears that the Fed may not go ahead with an easing as anticipated following a string of weak economic indicators.

President Bush on Tuesday announced several steps that he said would help boost the level of bank lending to consumers. This seemed to lessen motivation for the central bank to resort to a short-term rate ease.

Analysts said bond prices also suffered after the Treasury auctioned $9.28 billion in seven-year notes. While strong demand for the notes sent yields down to their lowest level since 1987, there was insufficient follow-up in the secondary Treasury market, where investors buy bonds from dealers, observers said.

An announcement by the Treasury that it would redeem $1.8 billion in 20-yer bonds before they mature in 1993, the first early redemption in 29 years, seemed to have little effect on the market.

In the secondary market for Treasury bonds, short-term maturities were down 1-32 to 1-16 point, intermediate maturities were off 3-16 point to point and long-term issues were down 13-16 point to 1 1-32 point, the Telerate Inc. financial information service reported.

The movement of a point equals a change of $10 in the price of a bond with a $1,000 face value.

The Lehman Brothers Daily Treasury Bond Index, which measures price movements on all outstanding Treasury issues with maturities of a year or longer, was quoted at 1,216.82, down 4.35.

Yields on three-month Treasury bills held at 5.14 percent as the discount was unchanged at 5.00 percent. Yields on six-month bills edged up to 5.26 percent as the discount was 1 basis point higher at 5.05 percent. Yields on one-year bills were up to 5.34 percent as the discount was up 4 basis point to 5.07 percent.

A basis point is one-hundredth of a percentage point. The yield is the annualized return on an investment in a Treasury bill. The discount is the percentage that bills are selling below the face value, paid at maturity.

In the tax-exempt market, the Bond Buyer index of 40 actively traded municipal bonds closed at 95 3-32, down 1/8 point. The average yield to maturity was 6.88 percent, up from 6.86 percent late Tuesday.