Turkey has adopted some strict measures to contain the spread but unlike many other countries it has stopped short of ordering people to stay at home. A jump in confirmed cases to 13,531 on Tuesday puts Turkey 10th globally.
Reflecting the sudden downturn, Turkey's manufacturing PMI returned to contraction in March.
It dropped to 48.1 from 52.4 a month earlier on softer output and new orders, while firms scaled back purchasing activity amid the outbreak.
The lira weakened some 0.6pc to 6.6570 against the dollar at 1023 GMT, its lowest level since Sept. 2018, when a currency crisis briefly halved its value and tipped the economy into recession. It had closed at 6.6175 on Tuesday.
Economists say Turkey is on the cusp of another possible recession as the fallout from the coronavirus is expected to slam exports, tourism and domestic demand in the coming months.
In March alone exports are expected to drop around 17pc as Turkey's biggest partners also grapple with the pandemic, Trade Minister Ruhsar Pekcan told broadcaster NTV. Exports to Iran declined by 82pc, those to Iraq by 48pc, to France by 32.5pc and to Germany by 14pc, she said.
Turkey's currency has fallen about 10pc against the dollar so far this year, though it has fared better than many emerging market peers amid the coronavirus fallout, which is expected to cause a severe global recession.
BANKING SHARES LEAD DOWNWARD SLIDE
Istanbul's main BIST100 share index was down 0.37pc, while the banking index declined 1.27pc on Wednesday.
Ankara has banned international flights, closed schools, bars and cafes, and stopped mass prayers. Yet the confirmed death toll from the outbreak has risen to 214, health ministry data showed. for the global spread of the coronavirus.
As part of the official response, the central bank set the stage Tuesday to raise a limit - currently set at about 33 billion liras ($5 billion) - on the amount of government debt it can buy this year.
The bank said it was also ready to conduct quantitative easing (QE) in a "front-loaded manner" to help finance what is expected to be a ballooning budget deficit as Ankara spends to ease a sharp economic slump.
For a period, dealer banks will also be able to sell to the central bank debt purchased from the Unemployment Insurance Fund, which has 131.6 billion lira and which will be tapped aggressively in coming months.
Separately, retail prices in Istanbul rose 0.33pc month-on-month in March, while wholesale prices increased 1.78pc, the Istanbul Chamber of Commerce said.