Increasing economic strength may soon push bond yields higher, predicts Wharton finance professor Jeremy Siegel.

Yields could increase a full percentage point, Siegel tells CNBC.

"When we really get 3 percent, 3-plus percent, 3.5 percent growth in the second quarter, we will see bonds really turn around. And I could see them rise 100 basis points, maybe not right away but through the year and into early next year."

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However, yields will rise only if the economy is strong, he stresses.

If the economy is strong, he adds, corporate earnings and stocks will perform well.

GDP growth dropped 1 percent in the first quarter, the first drop in three years, according to revised government data.

Although the first quarter was a "disaster," the poor showing is actually good news for the second quarter, Siegel says, predicting it will prompt a rebound in the second quarter. In fact, some analysts have hiked their second-quarter growth predictions to 3 percent or 3.5 percent.

Instead of rising as many anticipated, bond yields have dropped from 3 percent to around 2.5 percent this year.

"There are just these powerful forces that are continuing to buy bonds — hedge against uncertainty, pension funds de-risking their portfolio, baby boomers are not back really into stocks anywhere the way they used to be," Siegel explains. "And as a result, the bond market has a really big demand on it that's keeping these yields lower."

Other economists agree that the economy will bounce back robustly in the second quarter. Economists believe cold weather was a major reason for the weak first quarter. Weather-related factors slashed up to 1.5 percentage points off GDP growth, Reuters reports.

"The race isn't over yet for the economy. Things are better than you think. We are still expecting a strong finish to the year," says Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ, according to Reuters.

First-time applications for state unemployment benefits dropped 27,000 to a seasonally adjusted 300,000, and the four-week moving average for new claims was the lowest since August 2007.

"It fits into the overall picture of steadily improving labor market conditions. That is the key ingredient that is going to propel the economy forward," Anthony Karydakis, chief economic strategist at Miller Tabak, tells Reuters.

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