As markets process remarks from Fed officials, Treasury yields rise.

• The likelihood of a September interest rate cut by the Federal Reserve is increasing among traders, with a reduction in July being highly unlikely.
• Christopher Waller, the Fed Governor, stated on Wednesday that he believes cuts are imminent, but emphasized that he will closely monitor the data before making any decisions. Other officials expressed similar views.
• Officials want to see continued progress on inflation before moving on the possibility of a cut at the meeting-after-next in September, according to Deutsche Bank strategists.

On Thursday, U.S. Treasury yields increased as investors analyzed the implications of Federal Reserve officials' remarks on interest rates.

At 2:20 a.m. ET, the yield on the was trading at approximately 4.1672%, up around 2 basis points from its previous level. Meanwhile, the yield on the was also 2 basis points higher at 4.4524%.

Prices and yields move in opposite directions, with one basis point equal to 0.01%.

The likelihood of a July interest rate cut by the Federal Reserve is decreasing, while traders are increasingly betting on a September interest rate cut.

The CME FedWatch tool indicates that there is less than a 5% chance that the Fed will lower its target range for the federal funds rate in July. However, the probability of a September reduction, from 5.25-5.5% to 5-5.25%, is currently over 90%.

On Wednesday, Fed Governor Christopher Waller stated that he believes cuts are imminent, but emphasized that he will closely monitor the data before making any decisions.

""While I don't believe we have reached our final destination, I do believe we are getting closer to the time when a cut in the policy rate is warranted," he said in a speech."

John Williams, President of the New York Fed, and Thomas Barkin, President of the Richmond Fed, both expressed similar views in separate interviews. Williams shared his sentiments with the Wall Street Journal, while Barkin spoke at a business roundtable and said he would approach rate cuts with caution.

Officials want to see continued progress on inflation before moving on the possibility of a cut at the meeting-after-next in September, according to Deutsche Bank strategists.

This week, Jerome Powell, the Federal Reserve Chair, stated that it is probable that interest rates will be reduced prior to inflation reaching 2%.

According to Powell, if you wait until inflation drops to 2%, it may be too late, as the tightening measures will continue to impact inflation and drive it below 2%.

Prices decreased in June, according to the consumer price index published last week.

Last week's jobless claims data is due on Thursday, with economists predicting a rise to 229,000 claims, up from 222,000 the previous week, according to Dow Jones estimates.

There will also be auctions of 4-week and 8-week Treasury bills.

— CNBC's Jeff Cox contributed to this report.