World share markets have dipped for the worst week since the 2008 financial crisis, as investors ditched risky assets on concerns that coronavirus would become a pandemic, triggering a global recession.
Hopes that the epidemic would be over in a few months and economic activity would be normalized have been shattered, as new infections reported around the world have now surpassed those in China. The worsening global threat from coronavirus prompted investors to promptly step up bets that the U.S. Federal Reserve would need to cut down interest rates in the next month to support economic growth.
The impact of the coronavirus will be much more significant than the U.S.-China trade war. So the Federal does not have a reason to take a wait-and-see stance next month.
Experts feel that the coronavirus now looks like a pandemic. Markets can cope even if there is a significant risk as long they can see it ending soon. But at the moment, no one can predict how long this is going to last and how severe it can get.