By Gertrude Chavez-Dreyfuss

NEW YORK, July 9 (Reuters) - U.S. Treasuries firmed on Thursday as investors took advantage of this week's selloff to buy bonds, although gains were capped by caution over renewed attacks involving the United States and Iran.

In late morning trading, the benchmark 10-year yield, which moves inversely to prices, was down 1.6 basis points (bps) at 4.551% US10YT=RR, after hitting a seven-week high on Wednesday. U.S. 30-year bond yields were little changed at 5.065% US30YT=RR after also climbing to a seven-week peak the day before.

On the front end of the curve, 2-year notes US2YT=RR, which are sensitive to market expectations for Federal Reserve interest rate moves, slid 2 basis points (bps) to 4.18%. On Tuesday, the 2-year yield touched its highest level in two weeks.

"There's just a little bit of fatigue in the selloff and obviously, we're through 4.50% on 10s (10-year notes) and a little bit through 5% on 30s (30-year bonds)," said Zachary Griffiths, head of macro and investment-grade strategy at CreditSights in Charlotte, North Carolina.

"We've been using those levels as guideposts and we thought of those as attractive entry points. The latest developments in the Middle East and what we're hearing from the Fed, I'd say the balance of risks in the bond market are a little bit more two-sided."

Investors have refocused on the Iran war after Iranian armed forces launched attacks on U.S. military infrastructure in Gulf states on Thursday. That followed U.S. strikes on Iran's southern coastal and eastern provinces, putting further strain on a three-week-old ceasefire agreement.

Despite the attacks, U.S. crude futures were down 1.7% at $72.33 per barrel CLc1.

U.S. data on weekly jobless claims, meanwhile, backed expectations that the Federal Reserve will likely remain on hold for at least the next few meetings, with the labor market stabilizing after jobs sharply decelerated in June.

Initial claims for state unemployment benefits slipped 2,000 to a seasonally adjusted 215,000 for the week ended July 4, the Labor Department said on Thursday. Economists polled by Reuters had forecast 218,000 claims for the latest week.

U.S. rate futures on Thursday priced in just a 24.1% chance of a rate increase later this month, down from about 31% late on Wednesday, according to the CME Group's FedWatch tool.

Later on Thursday, investors will be focused on the auction of $22 billion in 30-year bonds, which J.P. Morgan believes will be absorbed by the market smoothly following strong outcomes from the sale of 3-year and 10-year notes.

"Given a higher level of outright yields, a more supportive macro backdrop, and supportive technicals, we think (the 30-year) auction can likely be digested smoothly," the U.S. bank wrote in a research note.

Since the last auction in June, 30-year yields are about 5 basis points higher, the bank noted.