U.S. Treasury yields rose across the curve on Thursday in tandem with global government bond markets, Yields on short-term bonds spiked as inflation fears linked to the U.S.-Iran war continued to sour sentiment.

At 6:50 a.m. ET, the benchmark 10-year Treasury yield was 2 basis points higher at 4.279%. The 30-year Treasury bond yield added 1 basis point, reaching 4.893. The 2-year Treasury note yield jumped 6 basis points to 3.807%.

One basis point is equal to 0.01%, and yields and prices move in opposite directions.

Investors are digesting the Federal Reserve's decision to hold its key interest rate steady. Announcing the update on Wednesday, the central bank said the "implications of developments in the Middle East for the U.S. economy are uncertain."

Fed officials also raised their predictions for the path of inflation and interest rates in data released on Wednesday. 

Central banks in Japan, Switzerland and Sweden also cited the war in Iran as they opted to keep their key interest rates unchanged on Thursday.

The ongoing conflict, surging oil prices and the effective closure of the Strait of Hormuz — a critical oil shipping route — have fueled concerns about an energy shock that will add inflationary pressure to economies across the globe.

Overnight, oil prices touched on $119 a barrel after energy facilities in Qatar and Iran were hit by strikes. Israel attacked Iran's South Pars gas field, prompting retaliatory missile attacks.

In a post on Truth Social late Wednesday night, President Donald Trump threatened to "massively blow-up" the South Pars field if Qatar is attacked again.

"NO MORE ATTACKS WILL BE MADE BY ISRAEL pertaining to this extremely important and valuable South Pars Field unless Iran unwisely decides to attack a very innocent, in this case, Qatar - In which instance the United States of America, with or without the help or consent of Israel, will massively blow up the entirety of the South Pars Gas Field at an amount of strength and power that Iran has never seen or witnessed before," he said.

In a note on Thursday morning, Deutsche Bank's Jim Reid said the escalation in strikes against energy infrastructure across the Middle East, and the "more watchful tone on inflation" from Fed Chair Jerome Powell had "sent investors pricing out the likelihood of rate cuts this year."

— CNBC's Matt Peterson and Jeff Cox contributed to this article.