treasury yields rose on thursday led by the policysensitive 2year rate after a raft of us data had traders pricing in a greater chance of interest rate hikes by the federal reserve next week and in june data released on thursday showed that us firstquarter gdp advanced at a lackluster 11 pace amid declining business investment that was less than the 2 increase that wall street analysts had forecast for gross domestic product the official scorecard for the economynonetheless consumer spending the main engine of us growth drove the economy forward during that period outlays jumped at a 37 clip the biggest increase in almost two yearsin a separate report weekly initial jobless benefit claims fell sharply by 16000 to 230000 for the week that ended april 22 the decline almost wiped away the last two weekly gains after the data releases fed funds futures traders swung back to pricing in a more than 80 chance of a quarterpoint rate increase next wednesday by the us central bank the likelihood of a may rate hike by the federal reserve was seen at 854 up from 72 a day ago which would lift the fedfunds rate target to between 5 and 525 according to the cme fedwatch tool traders also factored in a decent 24 chance of another quarter percentage point hike in june and pulled back on the extent of rate cuts they see through december on friday the feds favored inflation gauge the core pce index for march will be releasedlate wednesday the republicanrun house of representatives approved a debtceiling bill in a 217215 vote one step in a process thats closely watched by traders worried about a possible us default what analysts are saying the disappointing 11 annualized rise in firstquarter gdp indicates that the economy had less forward momentum at the start of this year than previously thought we continue to expect the drag from higher interest rates and tightening credit conditions to push the economy into a mild recession soon said andrew hunter deputy chief us economist for capital economics overall the data confirm the message from other indicators that while economic growth is slowing it isnt yet collapsing hunter wrote in a note nevertheless with most leading indicators of recession still flashing red and the drag from tighter credit conditions still to feed through we expect a more marked weakening soon this content was created by marketwatch which is operated by dow jones  co marketwatch is published independently from dow jones newswires and the wall street journal