Global bond markets tumbled in Asian trading Monday as an oil price shock prompted investors to price in higher inflation and a deteriorating economic growth outlook. The selloff reflects mounting concerns that rising energy costs could trigger persistent inflation while slowing economic activity, a dangerous combination known as stagflation. This development signals investors are increasingly pessimistic about central banks' ability to manage the economy without triggering recessions, pushing yields higher across developed markets. Oil prices surged to multi-year highs, directly fueling the inflation fears driving the bond rout.

The sharp selloff underscores how commodity shocks can rapidly undermine market stability and force central banks into difficult policy trade-offs.