SINGAPORE (Reuters) -Stocks in Asia made an uneven recovery as higher-than-expected producer price inflation dampened expectations of a jumbo rate cut at the Federal Reserve's September meeting, while U.S. bonds and equity futures stabilised. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.3% after a report on Thursday from the Bureau of Labor Statistics which showed the Producer Price Index increased 0.9% in July on a month-over-month basis, well above economists' expectations. "What it did was to get rid of all the chat about a 50 basis point cut," said Mike Houlahan, director at Electus Financial Ltd in Auckland. The market is currently pricing in a 92.1% probability of a 25 basis point rate cut at its September meeting, compared with a 100% likelihood of a cut on Thursday, according to the CME Group's FedWatch tool. The chance of a jumbo 50 basis point cut fell to 0% from an earlier expectation of 5.7% a day ago. U.S. stock futures were flat in early Asian trading after ending a choppy trading session on Wall Street with mild gains on Thursday. The yield on the U.S. 10-year Treasury bond was down 1 basis point at 4.2829%. The two-year yield, which is sensitive to traders' expectations of Fed fund rates, slipped to 3.7304% compared with a U.S. close of 3.739%. Nasdaq futures extended losses into a third consecutive day, sliding 0.1% lower.

The dollar index, which tracks the greenback against a basket of currencies of other major trading partners, retraced some gains after the PPI data release, last trading down 0.1% at 98.143. The Nikkei 225 rebounded 0.4% after snapping a six-day winning streak on Thursday with its biggest one-day selloff since April 11, as Japanese GDP data showed the economy expanding by an annualised 1.0% in the April-June quarter, beating analyst estimates. The dollar weakened 0.3% against the yen to 147.64. Australian shares were last up 0.2%, while stocks in Hong Kong were down 0.9% following losses on Thursday for U.S.-listed exchange-traded funds tracking Chinese companies.

The CSI 300 gave up early gains and was last trading flat after the release of weaker-than-expected Chinese economic data for July including retail sales and industrial production.Markets in India and South Korea are closed for public holidays. Cryptocurrency markets stabilised after a new record for bitcoin of $124,480.82 on Thursday proved fragile and promptly crumbled after falling short of its next key milestone. The digital currency was last up 0.7%, recovering some ground, while ether gained 1.7%. "Bitcoin's failure to conquer the $125,000 resistance signals another consolidation phase," said Tony Sycamore, a market analyst at IG in Sydney. In commodities markets, Brent crude was flat at $66.94 per barrel ahead of a meeting in Alaska between U.S. President Donald Trump and Russian leader Vladimir Putin. Gold was slightly lower as the markets digested the path of inflation-adjusted interest rates, which typically move in the opposite direction from bullion prices. Spot gold was trading up 0.1% at $3,339 per ounce. [GOL/] In early European trades, the pan-region futures were up 0.4%, German DAX futures were up 0.3% at 24,489, and FTSE futures were up 0.5%.