Fed expected to reduce interest rates sharply

Singapore/London: Central banks are likely to launch new coordinated emergency action this week to calm panic in financial markets, which could be rocked further by data pointing to global recession.

The US Federal Reserve is expected to cut rates sharply following share selloffs and currency collapses in developed econ-omies and the emerging markets of Asia and Latin America.

Advance third-quarter US economic growth data due on Thursday is expected to show a 0.5 per cent contraction in gross domestic product after 2.8 per cent growth the previous quarter.