SYDNEY (Reuters) - Asian share markets slid on Monday after worries about a possible U.S. economic downturn slugged Wall Street, while dragging bond yields and commodity prices lower as investors avoided risk assets for safer harbours.

Japan's Nikkei bore the brunt of the early selling as a stronger yen pressured exporters, losing 2.4% on top of a near 6% slide last week.

MSCI's broadest index of Asia-Pacific shares outside Japan slipped 0.6%, after losing 2.25% last week.

S&P 500 futures and Nasdaq futures were both a fraction lower, after Friday's slide.

Fed fund futures were little changed as investors wondered whether the mixed U.S. August payrolls report would be enough to tip the Federal Reserve into cutting rates by an outsized 50 basis points when it meets next week.

So far, markets imply only a 29% chance of a large cut, in part due to comments from Fed Governor Christopher Waller and New York Fed President John Williams on Friday, though Waller did leave open the option of aggressive easing.

"Our read of the data is that the labour market continues to cool, but we see no sign of the kind of rapid deterioration in conditions that would call for a 50bp rate cut," Barclays economist Christian Keller said.

"Importantly, we also see no indication of any appetite for this in Fed communications," he added. "We retain our call for the Fed to begin its cycle with a 25bp cut, followed by two more 25bp at the remaining two meetings this year, and a total of 75bp of cuts next year."

Investors are considerably more dovish and have priced in 115 basis points of easing by Christmas and another 127 basis points for 2025.

Data on August U.S. consumer prices on Wednesday should underline the case for a cut, if not the size, with headline inflation seen slowing to 2.6% from 2.9%.

ECB TO EASE

Markets are also fully priced for a quarter-point cut from the European Central Bank on Thursday, but are less sure on whether it will ease in both October and December.

"What matters will be guidance beyond September, where there's strong pressure on both sides," analysts at TD Securities noted in a note.

"Wage growth and services inflation remain strong, emboldening the hawks, while growth indicators are flagging softer, emboldening the doves," they added. "Quarterly cuts are likely more consistent with the new projections."

The prospect of global policy easing boosted bonds, with 10-year Treasury yields hitting 15-month lows and two-year yields the lowest since March 2023.

The 10-year was last at 3.734% and the two at 3.661%, leaving the curve near its steepest since mid-2022.

The drop in yields encouraged a further unwinding of yen carry trades which saw the dollar sink as deep as 141.75 yen on Friday before steadying at 142.41 early on Monday.

The euro held at $1.1090, having briefly been as high as $1.1155 on Friday. [USD/]

Data on consumer prices (CPI) from China due later Monday are expected to show the Asian giant remains a force for disinflation, with producer prices seen falling an annual 1.4% in August.

The CPI is forecast to edge up to 0.7% for the year, from 0.5%, mainly due to rising food prices.

Figures on China's trade account due Tuesday are expected to show a slowdown in both export and import growth.

Also on Tuesday, Democrat Kamala Harris and Republican Donald Trump debate for the first time ahead of the presidential election on Nov. 5.

In commodity markets, the slide in bond yields kept gold restrained at $2,496 an ounce and short of its recent all-time top of $2.531. [GOL/]

Oil prices found some support after suffering their biggest weekly fall in 11 months last week amid persistent concerns about global demand. [O/R]

Brent added 57 cents to $71.63 a barrel, while U.S. crude firmed 60 cents to $68.27 per barrel.