Two year treasuries fell on Thursday on expectations that the Federal Reserve will be slowing rate cuts to avoid stoking further inflation.

The two-year treasury note fell 2/32 in price to yield 2.142 percent, its firs yield above 2 percent since late February. Ten year treasury notes rose 4/32 in price to yield 3.708 percent

Futures traders on the Chicago Board of Trade were betting that the Federal Reserve will only make a quarter point cut in interest rates during its next meeting on April 30.

There is a 98 percent chance of a quarter point cut, according to futures investors, compared with 46 percent a week ago who believed there would be a half percent cut.