Earlier in the session, US yields dropped following steep losses in Chinese stocks on worries over tighter regulations in the world's second largest economy.
The Fed is not expected to announce any plans to pare its bond purchases until its August Jackson Hole economic symposium, though it may start dropping hints that it has started to talk about a taper.
"This rally in rates seems very counterintuitive. I still haven't found a very strong case besides perhaps the offset of positioning, people are getting out of trades ahead of the FOMC," Rajappa said.
Thursday's data on US jobless claims and first-quarter gross domestic product growth also helped extend Treasury yields. Both reports showed the US economy was on a stable path to recovery from the pandemic.
Investors are also awaiting the Treasury's sale of $62 billion in 7-year debt later on Thursday, after strong 2-year and 5-year note auctions on Tuesday and Wednesday.
The yield on 10-year Treasury notes was up 0.5 basis point to 1.654% as the longer-dated government debt edged slightly higher but the short end remained mostly unchanged.
"Forward breakevens are lower than spot breakevens, suggesting the market thinks inflation is going to rise then fall," he said.