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Government bond prices dropped Friday as traders became jittery over emerging signs of economic growth.

Analysts described a frustrating day in which prices fell despite a higher unemployment report for February and the Federal Reserve further cutting an important short-term interest rate, the federal funds rate. Bonds typically would rally on such news.But the Treasury's 30-year bond was down 31-32 points, or $9.69 per $1,000 in face amount, at closing Friday. Its yield rose to 8.30 percent from 8.21 percent late Thursday.

The Fed moved to drop the federal funds rate - the rate on overnight loans between banks - by 0.25 of a percentage point to 6 percent after the Labor Department reported another rise in unemployment. It marks the seventh time the central bank has reduced this rate since late October, when it stood at 8 percent.

The federal funds rate was quoted at 6 percent late Friday, down from 63/8 percent late Thursday.

The Labor Department said unemployment rose to 6.5 percent in February, a rate slightly higher than economists had expected. Some traders dismissed the report, arguing the rate was skewed by the recessionary effect of the Persian Gulf war, said Marilyn Cohen, analyst for Capital Insight Inc. of Beverely Hills, Calif.

Cohen and others said analysts also expect the cut in the federal funds rate probably will be the last reduction for quite a while. Many analysts believe some sectors of the economy are improving, meaning the Fed would likely refrain from easing monetary policy.