NEW YORK, April 30 (Reuters) - U.S. Treasury yields rose

on Tuesday after data showed labor costs increased more than

expected in the first quarter boosted by the rise in wages and

benefits, reinforcing expectations that the Federal Reserve will

delay the start of its easing cycle to later in the year.

In midday trading, the benchmark 10-year yield

rose 4.7 basis points (bps) to 4.659%. The yield on the 30-year

Treasury bond was up 3.2 bps at 4.767%.

On the short end of the curve, the U.S. two-year Treasury

yield, which typically reflects interest rate expectations, rose

to hit its highest since November at 5.03%. The yield was last

up 3.9 bps to 5.01%.

Data showed that the Employment Cost Index (ECI), the

broadest measure of labor costs, increased 1.2% last quarter

after rising by an unrevised 0.9% in the fourth quarter.

The report came just before a two-day Fed policy meeting, in

which the central bank is widely expected to hold interest rates

unchanged at the 5.25% to 5.50% range. Bond investors are

expecting Fed Chair Jerome Powell to sound hawkish in his press

conference, likely noting that the central bank is no rush to

cut interest rates given persistent inflation and a still-robust

labor market.

The ECI data will add to the Fed's expected hawkishness.

"I feel like the Fed is really between a rock and a hard

place because the bar to hike further is really high, (which)

would put ... more pressure on government coffers and their

ability to pay that high interest expense," said Ayako Yoshioka,

senior portfolio manager, at Wealth Enhancement Group.

"At the same time inflation is just crazy. So I think their

preference is to just stay at the (current) level, but the

inaction is going to frustrate the markets."

Other economic reports were mixed.

The Case-Shiller 20-City index of home prices rose 0.61% in

February, which equates to a strong 7.6% annualized increase,

much higher than consensus expectations.

Both the ECI and the Case-Shiller data will not be welcome

by the Fed as it tries to slow the economy.

The Chicago PMI, a barometer of business activity in the

U.S. Midwest, and U.S. consumer confidence, on the other hand,

undershot expectations.

The Chicago PMI dropped to a 17-month low of 37.9 from 41.4

in March, with the current level just a notch above the two-year

low of 37.8 seen in November 2022, Action Economics said in its

blog after the data.

U.S. consumer confidence also worsened in April, falling to

its lowest in more than 1-1/2 years, a survey showed on Tuesday.

The Conference Board said its consumer confidence index fell

to 97.0 this month, the weakest level since July 2022, from a

downwardly revised 103.1 in March. Economists polled by Reuters

had forecast the index little changed at 104.0 from the

previously reported 104.7.

The weak data had little impact on the rates market, but it

did prevent Treasury yields from rising further.

Post-data, U.S. rate futures have priced in a 77% chance of

a rate cut in December, down from 90% a week ago, according the

CME's FedWatch tool. The market has also priced in just 31 bps

of easing this year, equivalent to one rate cut, compared with

six at the beginning of the year.