Thursday's hotter-than-expected PPI report hasn't moved the needle much when it comes to traders' expectations for a September Fed rate cut. Fed funds futures were pricing in more than 96% probability of a Fed rate cut in September,

Futures markets are also expecting a rate cut. Investors peg the chances of a quarter-point interest rate cut at nearly 96%, according to the CME FedWatch Tool, a measure of market sentiment.

Treasuries moved lower after a reading of inflation at the production level came in stronger than expected, prompting traders to pare bets the Federal Reserve will cut interest rates next month.