(Updates with new details, context)
JOHANNESBURG, March 16 (Reuters) - South Africa's rand, stocks and government bonds plunged on Monday, as fears surrounding the coronavirus outbreak roiled financial markets worldwide and cemented local economists' expectations for an interest rate cut this week.
At 1600 GMT, the rand ZAR=D3 traded at 16.5630 per dollar, around 2.5% weaker than its previous close.
The Johannesburg Stock Exchange (JSE) suffered one of its steepest daily drop on record, its All-Share Index .JALSH falling more than 8%, while the yield on the 2030 rand-denominated government bond ZAR2030= rose 77 basis points.
South Africa has recorded 62 confirmed cases of the coronavirus, far fewer than in many countries in Europe and Asia. Public health experts, however, are concerned that the number of cases could quickly get out of control if local transmission takes hold in poor and overcrowded informal settlements.
President Cyril Ramaphosa declared a national state of disaster on Sunday, imposing travel bans on foreign nationals from "high-risk" countries such as Italy, Germany, China, Britain and the United States and prohibiting public gatherings of more than 100 people. most industrialised economy is already in recession, and the pandemic is expected to make matters worse by hurting tourist arrivals and commodity exports to major trading partner China.
Citi said on Monday that it expected the South African Reserve Bank to cut its main lending rate by 50 basis points this week because of the economic shock from the coronavirus.
"Monetary policy is the only response South Africa has given lacking fiscal space," the U.S. bank's economist Gina Schoeman said.
The drop in the JSE's All-Share Index to 40,500 points was its worst daily decline since October 1997.
"At this point, there seems to be little faith over the effectiveness of monetary policy to counter the damage inflicted by the coronavirus outbreak," said Lukman Otunuga, senior research analyst at FXTM.
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