NEW YORK (CNN/Money) - Bond prices slid Thursday as falling oil prices took the wind out of a potential bond rally and boosted the dollar.

The benchmark 10-year note fell 12/32 of a point to 96-8/32, yielding 4.47 percent, up from 4.43 late Wednesday, while the 30-year bond slumped 26/32 of a point to 108-21/32 to yield 4.78 percent, down from late Wednesday's 4.73. Bond prices and yields move in opposite directions.

In shorter-dated debt, the five-year note lost 6/32 of a point to yield 4.12 percent, while the two-year dropped one tick to yield 3.71 percent.

Oil prices began to fall around midday to settle about 3 percent lower on the session. The move helped spark a stock market rally that moved money away from safe-haven government debt.

Earlier in the morning, traders had eyed a rally after a lack of economic reads allowed the 10-year yield to fall below a major chart barrier at 4.42 percent, the trading high which the benchmark note flirted with before the Federal Reserve's most recent interest rate hike.

When no follow-though demand emerged, buyers quickly bailed out and the 10-year yield lifted to 4.47 percent.

"I have to say, the initial break of 4.42 hasn't produced the fireworks many were expecting. If anything, there's fresh selling emerging and this whole move could be a flash in the pan," one trader at a U.S. primary dealer told Reuters.

Treasury prices have generally traded higher since last Tuesday, in the wake of a bearish market weighed down by inflation fears that sent the yield on the 10-year note to an eight-month high at 4.64 percent last Monday.

Bond traders loathe high inflation, which generally erodes the value of fixed-income investments.

In currency trading, the dollar rose against the euro and the yen, turning higher after investors spent the morning taking profits on the greenback's recent runup.

The euro bought $1.2851, down from $1.2866 late Wednesday, while the dollar bought ¥108.66, up from ¥108.65 in the previous session.

Trading was quiet as the day's economic reports were too mixed to offer much direction.

The Labor Department reported that initial claims for jobless benefits fell to 334,000 from a revised 353,000 the week before, nearly matching forecasts from economists surveyed by Briefing.com for claims to fall back to 330,000 last week.

Wholesale inventories rose 0.6 percent in February, while sales surprised by falling 0.4 percent, the first drop since April, 2003.

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