The global bond market rally accelerated on Wednesday, as New Zealand’s central bank became the latest to sound a gloomy note on economic growth and traders ratcheted up bets that the Federal Reserve will start cutting interest rates this year.

The 10-year Treasury yield slipped another 6 basis points to 2.37 per cent, the lowest since 2017, as the US bond market heads towards its second-best monthly performance in more than a decade. Traders are now betting that there is almost an 80 per cent probability of the Fed trimming rates at least once this year — and a meaningful chance of several cuts.

March’s fixed-income rally has been broad-based, buoying the debt of virtually every highly rated government. Germany even sold 10-year bonds with a negative yield for the first time since the autumn of 2016 on Wednesday, highlighting how the move lower in government bond yields has begun to affect deals in the primary market.