Market participants are not making "rational" decisions when trading on the back of the coronavirus outbreak, an economist told CNBC's "Squawk Box Europe" Friday.

Global equities have been on a roller-coaster ride, mainly since the first cases of the new coronavirus were registered in Europe last month. Equities have sold off sharply, but have recouped some losses after emergency rate cuts and pledges of financial help to combat the fallout from the virus.

"We are all guessing, anyone who's banging the table and says 'It is going to be A,B,C' is deluded, we just don't know," Ian Shepherdson, chief economist at Pantheon Macroeconomics, told CNBC.

The bond market was particularly volatile Friday morning. The yield, which moves inversely to the price, on the 10-year Treasury note sank below 0.700% — an all-time low. This shows investors are seeking safer assets amid the uncertainty over the lasting impact of the coronavirus.

"The issue here is that the Treasury is the safe haven asset of the world, when we have an unknowable … in that environment fear takes over everything and when fear takes over everything, stocks are sold and the 10-year Treasury is bid," Shepherdson said Friday.

The yield on the 30-year Treasury bond also hit a record low on Friday. It hit a record low of 1.2800% during Friday's session.

"If the U.S. reports 3,000 coronavirus cases, (yields) will go lower, but that's not necessarily because anyone is sitting down with a spreadsheet and making any sort of rational long-term valuation. They are buying out of fear," Shepherdson said.

The death toll related to the coronavirus has hit 12 in the United States and more than 225 cases have been confirmed across the country.