The supply of bonds worldwide will fall $460 billion short of demand this year, underpinning support that confounded forecasters and sent the fixed-income market to its best start to a year since 2003.

Debt issued by sovereign, corporate and other borrowers will decline by $600 billion to a net $1.8 trillion in 2014, as demand reaches $2.26 trillion, according to New York-based JPMorgan Chase & Co., the world's biggest corporate bond underwriter. Demand has pushed down average bond yields to levels unseen since May 2013 as economies slow, borrowing is reduced and central banks signal no rush to start raising interest rates anytime soon.

The imbalance helps explain why most forecasters have gotten it wrong this year when predicting bond prices and yields. The market received a boost on June 5 when the European Central Bank became the first major central bank to charge fees on deposits and unveiled other plans to support an economy threatened by deflation.