Economic guru Bill Gross warns that the bond-market bull run is finally running out of steam.

Gross, who runs the Janus Henderson Global Unconstrained Bond Fund, said 2018 is the year the bond market's luck finally runs out after the bull market started in 1981.

Bond yields are likely to rise only slowly, but that will result in basically flat returns for fixed income, Gross told CNBC.

"It's not a strong Colombian bear market, it's a decaffeinated bear market, where yields on the 10-year probably rise 10 to 20 to 30 basis points for the year," Gross said during an interview on CNBC's "Power Lunch." "Nevertheless, it means yields are probably moving higher instead of lower."

Gross said the days of mid-single digit returns for bond investors are likely over.

"I think bonds produce a return of zero to 1 percent," he said. "Is that a bear market? No. But it's a market where investors don't get much of a return."

Meanwhile, the bond market’s stalwarts finally stepped in after the Federal Reserve’s decision to hold rates steady Wednesday, and their appetite had little to do with the central bank itself.

The 30-year U.S. yield tumbled in the hour after the Fed released its January statement, pushing the Treasuries yield curve from 5 to 30 years to the flattest level since August 2007. Traders and strategists pointed to a wave of month-end purchases from investors like index funds and pensions as driving the rally, which coincided with the S&P 500 Index’s dip to its weakest point of the day.

Traders in the world’s biggest bond market had been waiting for these buyers to emerge, particularly after U.S. equities posted handsome gains this month while Treasuries sold off, Bloomberg explained.

For long-term investors like pensions, the divergence magnifies their need to rebalance. Yet those purchases appear to have been absent for much of this week, with the yield curve steepening the previous two sessions.

When it comes to the long-bond rally, “I don’t think the Fed really had much to do with it -- strong month-end flows appear to be the reason,” said John Briggs, head of strategy, Americas, at NatWest Markets. Among the likely buyers, he lists “indexers that need to extend duration to keep up with index extension, and pension funds allocating out of stocks and into bonds to keep allocations steady.”