(Adds quotes, data outlook, updates prices) By Karen Brettell NEW YORK, April 29 (Reuters) - U.S Treasury yields hit two-week highs on Thursday after President Joe Biden proposed trillions of dollars in new spending, and as data showed American economic growth accelerated in the first quarter. Biden late on Wednesday proposed spending $1.8 trillion on education and childcare, which would be financed by raising the top marginal tax rate for the wealthiest Americans. That is on top of a $2 trillion jobs-and-infrastructure plan to be paid for by raising taxes on U.S. companies. Market participants are concerned that Treasury issuance will need to increase to pay for the spending. “There’s certainly quite a bit of uncertainty about how much of it will be offset through tax increases ... and how much will rates have to rise to kind of pencil in this increase in supply,” said Gennadiy Goldberg, an interest rate strategist at TD Securities in New York. Yields also rose after the Commerce Department said gross domestic product increased at a 6.4% annualized rate last quarter. Benchmark 10-year note yields reached 1.690%, the highest since April 13, before fading back to 1.640%, up two basis points on the day. They have risen from 1.531% last week but are holding below one-year highs of 1.776% reached in March. Inflation expectations hit eight-year highs of 2.46%, before falling back to 2.43%, based on breakeven rates on 10-year Treasury Inflation-Protected Securities (TIPS). Yields tumbled on Wednesday after Federal Reserve Chairman Jerome Powell said at the conclusion of the Fed"s two-day meeting that it was too soon to talk about tapering bond purchases because the economy is still far away from meeting the U.S. central bank’s employment and inflation goals. Lou Brien, a market strategist at DRW Trading in Chicago, said its puzzling that yields aren"t higher given the ongoing bond purchases. "Every time they’ve done QE the yield has gone up not down, because of the possibility that they will encourage inflation," Brien said. "I still look at the bond and say why aren’t they higher in yields." Some analysts say the Fed may begin hinting toward a taper announcement in the coming months, with a reduction in bond purchases possible by year-end. Others think, however, that any tightening could take longer as it will be difficult to predict how the economy will look later in the year. Data on Friday will give fresh information on personal consumption expenditures (PCE) in March. It will be followed next week by April"s highly anticipated jobs report. One-year Treasury bill yields also fell to record lows after the Fed kept the interest rate it pays on excess reserves (IOER) and reverse repos unchanged. The bill yields dropped as low as 0.0507% on Thursday. Money markets are struggling with a strong demand for short-term assets and dwindling supply as the Treasury Department cuts bill issuance and reduces its cash balance. The cost to borrow Treasuries overnight in the repurchase agreement market rose to three basis points, after earlier dropping to zero. April 29 Thursday 3:06PM New York / 1906 GMT Price Current Net Yield % Change (bps) Three-month bills 0.0125 0.0127 -0.005 Six-month bills 0.03 0.0304 -0.005 Two-year note 99-235/256 0.1661 0.000 Three-year note 100-26/256 0.3405 0.002 Five-year note 99-112/256 0.8652 0.000 Seven-year note 99-128/256 1.325 0.012 10-year note 95-92/256 1.6397 0.020 20-year bond 94-232/256 2.1935 0.009 30-year bond 90-172/256 2.3097 0.010 DOLLAR SWAP SPREADS Last (bps) Net Change (bps) U.S. 2-year dollar swap 11.50 0.25 spread U.S. 3-year dollar swap 14.00 0.00 spread U.S. 5-year dollar swap 8.75 0.25 spread U.S. 10-year dollar swap -0.25 0.25 spread U.S. 30-year dollar swap -26.00 0.75 spread (Reporting by Karen Brettell; editing by Jonathan Oatis and Nick Zieminski)