The Federal Reserve‘s chairman shattered Wall Street‘s hopes that it will soon lower its high-interest rates in an effort to rein in inflation, causing the Dow Jones Industrial Average to drop more than 1,000 points on Friday.

The S&P 500 fell 3.4%, the most since mid-June after Jerome Powell said the Fed will likely need to keep interest rates high enough to slow the economy “for some time” in order to combat the country’s rising inflation.

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The Dow fell 3%, while the Nasdaq composite fell 3.9%, suggesting a wide sell-off headed by technology sectors. Higher interest rates assist to keep inflation in check, but they also harm asset prices.

The Fed has indicated it will raise rates into next year as it tries to quell demand and bring down prices for goods and services. But some investors speculated the central bank might pause or even reverse course next year if inflation subsides, leading to a rally for stocks in July and early August.

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Some analysts expected Powell to bat down that talk in Friday’s speech, and he delivered. His speech followed up remarks by several other Fed officials, who also pushed back on speculation the Fed might act less aggressively or even “pivot.”

The sell-off capped a week of choppy trading that left major indexes down 4% or more for the week.

All told, the S&P 500 fell 141.46 points to 4,057.66. The benchmark index is now down almost 15% for the year.

The Dow lost 1,008.38 points to close at 32,283.40. The last time the blue-chip average had a 1,000-point drop was in May.

The Nasdaq slid 497.56 points to 12,141.71, its biggest drop since June.

The Russell 2000 index of smaller companies fell 64.81 points, or 3.3%, to finish at 1,899.83.

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Stocks are still showing solid gains for the third quarter, with the S&P 500 up more than 7% and the Nasdaq up 10%. Recent earnings reports were better than some analysts had expected, and there are signs that inflation may have peaked although it remains at sharply elevated levels.

Still, Powell’s speech made clear the Fed will accept weaker growth for a while for the sake of getting inflation under control, analysts said.

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Following the reports and Powell’s comments, the two-year Treasury yield rose for much of the day but slipped by late afternoon to 3.36% from 3.37% late Thursday. It tends to track expectations for Fed action.

The 10-year Treasury yield, which follows expectations for longer-term economic growth and inflation, initially rose then slipped to 3.02% from 3.03% late Thursday.