Interest rates are rising, and suddenly so is inflation. It looks as though the economy is poised to rebound, after skirting what Federal Reserve Chairman Alan Greenspan has called a "soft patch."

Since the Fed last eased credit Jan. 31, the yield on the 30-year Treasury "long" bond has soared from 6.02% to nearly 6.5% At the shorter end of the curve, the yield on two-year Treasury notes has moved up from 4.92% to nearly 5.4%.

The latest bond market tremors were sparked by the Labor Department's report last week that the Consumer Price Index had risen a greater-than- expected 0.4% in January.

What is going on? Have interest rates bottomed, as some investors apparently seem to think?

"The markets are being driven right now by some erroneous assumptions," said Philip Braverman, chief economist at DKB Securities, New York.

"In the opening month or two of the year, for the past several years, there have been price rises that have then disappeared or are reversed as consumer resistance builds," Mr. Braverman said.

"The Bureau of Labor Statistics itself has acknowledged it is not yet fully able to account for this through seasonal adjustments," he said.

Among other things, retailers, who had slashed prices in December to bolster their Christmas selling season, restored prices in January to protect profit margins. Those moves can be erroneously indicative of inflation.

Meanwhile, Japanese-based bond investors have been taking profits from their U.S. portfolios in advance of the end of Japan's fiscal year, March 31. Once that date is passed, these investors will probably be back in the market, Mr. Braverman said, and the spike-up in rates will end.

Mr. Braverman sees weak economic growth ahead, about a 0.5% rate of growth in output for 1996, along with continued low inflation. He expects the Fed to cut rates through the rest of the year, probably by 75 to 100 basis points, to bolster business conditions.

Other economists have similar views on rates and inflation. Most expect some further easing of rates by the Fed, although some anticipate somewhat more economic growth than Mr. Braverman does.

"After shaking off temporary forces such as the heavy snows, GDP will pick up in the spring," said economist Nicholas Perna of Fleet Financial Group. "This limits further Fed easing in 1996 to another 25 to 50 basis points."

"Our forecast is little changed," said James W. Coons, chief economist at Huntington National Bank, Columbus, Ohio. "We still look for sub-par economic growth, low inflation, and falling short-term interest rates.

"Long rates might dip further, too," he said, "but only temporarily, unless the economy succumbs to recession."

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