The US 10-year Treasury yield hit 1.74% Thursday morning, despite assurances from the Federal Reserve that it had no plans to raise interest rates anytime soon or curtail its bond purchase program.

The benchmark 10-year Treasury note yield had slashed some gains to 1.722% by 5:15 a.m. ET. The yield on the 30-year government bond was 2.483%. The returns move in reverse to the prices.

After closing the Fed’s two-day meeting on Wednesday, the central bank announced that it sees stronger economic growth than previously thought and forecasts that gross domestic product will rise to 6.5% in 2021. This corresponds to a forecast of 4.2% of GDP growth in December.

The Fed also expected core inflation to hit 2.2% this year, but a long-term expectation that it would stay around 2%.

The US Federal Reserve also said it has no plans to raise interest rates until 2023 and that it will continue its program of buying bonds worth at least $ 120 billion a month.

Fed Chairman Jerome Powell reiterated that the central bank would like to see constant inflation above its 2% target and a substantial improvement in the US labor market before considering changes in interest rates or monthly bond purchases.

Quilter Investors’ portfolio manager Hinesh Patel said on Wednesday following the Fed policy decision, “While no response is the only move offered, whatever Powell is doing at this point, the Fed is putting bond markets in danger.”

“If they do nothing, the bond market will continue to drive yields higher so the Fed can increase or adjust bond purchases. If it acts now, it will be accused of over-stimulating and getting too hot,” he said.

However, Willem Sels, chief investment officer, private banking and wealth management at HSBC, said the Fed’s message of a gradual normalization of policy meant that this was “a very different situation than 2013, when the bond rejuvenation surprised the market and took the lead Real return is increasing rapidly and significantly, causing stocks, gold and risk-weighted assets to be sold. “

There have been some concerns that the recent surge in bond yields and inflation expectations could mark a repeat of the 2013 “tantrum”. That was when government bond yields suddenly spiked on the market panic after the Fed announced it would curtail its quantitative easing program.

On Thursday, the weekly unemployment claims data is due at 8:30 a.m. CET.

Auctions are scheduled for Thursday for four-week bills worth $ 40 billion, eight-week bills worth $ 40 billion, and nine-year 10-month inflation-linked government bond securities worth $ 13 billion.

– CNBC’s Thomas Franck contributed to this report.