* ECB upgrades growth forecast, cuts inflation outlook
* EX-FBI chief Comey testifies, markets show little reaction (Recasts, updates prices; adds comment, table)
By Gertrude Chavez-Dreyfuss
NEW YORK, June 8 (Reuters) - U.S. Treasury debt yields rose on Thursday, in line with German bonds, after the European Central Bank upgraded its growth forecast for the euro zone, but suggested the bank's stimulus plan will remain intact due to a lower inflation outlook.
In the United States, former FBI director James Comey was testifying before a Senate committee on Thursday and said he was disturbed by President Donald Trump's bid to get him to drop a probe into the former national security adviser. Comey, however, could not say whether he thought the president sought to obstruct justice.
Trump fired Comey on May 9.
Treasury prices remained lower as Comey testified.
"At the end of the day, former FBI Director Comey hasn't really revealed anything new, in my view, so bond prices are either treading water to heading lower," said Tom di Galoma, managing director at Seaport Global Holdings in New York.
The more important driver for the market, di Galoma said, was the expected rate hike by the Federal Reserve next week as well as U.S. long-dated Treasury debt auctions.
Thursday's ECB remarks also had some impact on the market, with U.S. yields initially falling, in line with the decline in German bond yields immediately following the bank's comments, before eventually rising.
Overall, the ECB signaled it planned no further interest rate cuts as euro zone prospects improved, but said subdued inflation meant it would continue to pump stimulus into the region's economy.
Draghi said in a press briefing that reducing asset purchases in the euro zone was not discussed at the meeting. He added that the ECB will be in the market for a long time.
"The fact that it no longer expects interest rates to remain at present 'or lower' levels is a clear deliberate signal that policy makers are gradually becoming more hawkish," said London-based Craig Erlam, senior market analyst, at OANDA.
The ECB now expects inflation of 1.5 percent in 2017 and 1.3 percent in 2018, compared with its forecasts of 1.7 percent and 1.6 percent respectively in March. That is still well below its target of just under 2 percent.
Benchmark German 10-year bond yields hit session lows of 0.253 percent following the ECB comments.
In midday trading, U.S. 10-year Treasuries were last down 5/32 in price, with yields at 2.198 percent, compared with 2.180 percent late on Wednesday.
U.S. 30-year bonds fell 9/32 in price, yielding 2.851 percent, compared with Wednesday's 2.837 percent. (Editing by Bernadette Baum and Chris Reese)