Global bonds have erased their losses for the year as concern the US economic outlook is rapidly worsening spurs demand for fixed-income assets.

Bloomberg’s index of global sovereign and corporate debt has now gained 1% for 2024 after being down as much as 4.6% in the middle of April. The gauge surged 2.3% last week alone. Bond markets took another jump Friday when monthly US payroll data showed hiring slowed and the jobless rate climbed to a three-year high.

Treasury 10-year yields slid five basis points in Asia Monday after tumbling 19 basis points Friday in the wake of the worse-than-expected US nonfarm payrolls report. Asian bonds echoed the move with Japan’s 10-year benchmark yield tumbling as much as 17 basis points, while similar-maturity New Zealand yields slipped 10 basis points.

“Japanese stocks are being taken to the woodshed, absolute chaos there this morning and it’s setting off a renewed bid for global fixed income,” said Prashant Newnaha, a senior rates strategist at TD Securities in Singapore. “Expect plenty of chop, but ultimately this leg lower in US yields has further room to run.”

Traders are boosting bets on Fed rate cuts following the recent spate of weak data. Economists at Citigroup Inc. and JPMorgan Chase & Co. are both now expecting the central bank to lower its benchmark by a half-point at both its September and November meetings.

  - Bloomberg