U.S. Treasurys yields rose on Friday, boosted by a third straight monthly gain in U.S. producer prices that brightened odds for a Federal Reserve interest rate hike as soon as September.
The Labor Department said its producer price index for final demand increased a more-than-forecast 0.2 percent last month after increasing 0.4 percent in June.
A key measure of underlying producer price pressures that excludes food, energy and trade services rose 0.2 percent last month after increasing 0.3 percent in June. The so-called core PPI was up 0.9 percent in the 12 months through July.
"The stronger core number actually encouraged a lot of people by raising the odds for a rate hike," said strategist Gennadiy Goldberg at TD Securities in New York.