* U.S. stocks slip about 4%, halting Tuesday's rally
* BoE announces surprise 50 bps cut to tackle coronavirus shock
* Oil falls after Saudi Aramco announces more production
* Graphic: World FX rates in 2020 tmsnrt.rs/2egbfVh
By Herbert Lash
NEW YORK, March 11 (Reuters) - The dollar weakened and global equities markets slid again on Wednesday, with Wall Street sharply lower, as the previous day's high hopes of government stimulus to tackle the coronavirus soured on the hard reality of still little action.
The strong stock rally on Tuesday petered out in Europe, even after the Bank of England joined other central banks in cutting interest rates, as investors pondered how much monetary and fiscal stimulus can dampen the epidemic's economic toll.
Britain announced a $39 billion war chest to soften the impact of the coronavirus after the BofE cut rates by half a percentage point. Italy, the hardest hit country outside of China, said it might further tighten already draconian curbs.
President Donald Trump met with fellow Republicans in the U.S. Senate on Tuesday to discuss fiscal stimulus, though concrete measures have not been announced.
The escalating outbreak also has the Federal Reserve trying to judge its potential economic impact in the absence of reliable data on how fast the flu-like illness will spread.
Economic stimulus will take time, while in the interim the virus spreads and more businesses suspend financial guidance, said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.
"You got uncertainty ramped up again this morning and it shows no sign of abating," Tuz said. "The volatility due to the virus and the response to the virus is at very severe levels. I don't see it really calming down until our arms are around the number of people who are affected in the U.S.," he said.
As of Tuesday's close, the recent rout had erased $8.1 trillion in value from global stock markets.
MSCI's U.S. centric gauge of stocks across the globe shed 3.17% while the pan-European STOXX 600 index lost 0.71%.
On Wall Street, the Dow Jones Industrial Average fell 1,171.23 points, or 4.68%, to 23,846.93. The S&P 500 lost 120.08 points, or 4.17%, to 2,762.15 and the Nasdaq Composite dropped 322.70 points, or 3.87%, to 8,021.55.
The dollar resumed its decline against the safe-haven Japanese yen and Swiss franc and gold rebounded, but was well off the $1,700 level it briefly hit Monday.
Sterling initially fell as much as 0.4% against the dollar and 1.2% against the euro after the BoE cut its benchmark rate by 50 basis points, to 0.25%. 1.1274
The Japanese yen strengthened 0.86% versus the greenback at 104.77 per dollar.
After a decade of extraordinary monetary policy, investors say the impact of easier policy has limits and increased government spending must be the dominant policy response to the economic consequences of the outbreak.
A key gauge of long-term euro zone inflation expectations dropped to another record low, in what analysts said suggested investors were positioning for deflation risks.
Benchmark U.S. 10-year Treasury yields rose 5 basis points to yield 0.804%, more than double Monday's record low yield of 0.3180%.0.7965
German government bond yields rose after the BoE cut supported sentiment, while Italian yields -- which had shot up on worries the country with Europe's worst outbreak of the virus is sliding into a recession -- tumbled as much as 20 basis points as bets grew on ECB stimulus.
Oil prices fell after Saudi Arabia and the United Arab Emirates announced plans to boost production capacity and OPEC and the U.S. Energy Information Administration (EIA) slashed oil demand forecasts because of the coronavirus outbreak.
Brent crude was down $1.03 to $36.19 a barrel, while U.S. West Texas Intermediate (WTI) crude was off 83 cents to $33.53.
Additional reporting by Marc Jones in London; Editing by Catherine Evans and David Gregorio