WASHINGTON - Despite a government report yesterday confirming that the U.S. economy cooled during the first three months of the year, the bond market still expects Federal Reserve officials to raise short-term interest rates again in May.

The Commerce Department said in its advance estimates that first-quarter gross domestic product increased at an annual rate of 2.6%, below most Wall Street predictions and well below the 7% boomlet recorded during the last three months of 1993.

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