NEW YORK, New York – Fears interest rate hikes in coming weeks and months will be more aggressive than previously thought drove global equity markets sharply lower on Friday.

Oil prices dived while the U.S. dollar soared.

U.S. Federal Reserve Chairman Jerome Powell sparked the frenzy which began Thursday after he commented that a 50 basis point official interest rate hike could be on the agenda when the monetary committee meets next month.

“In recent weeks, there has been growing chatter the Fed might look to ramp up the rate it will be tightening its policy, and the update from Jerome Powell made it very clear that will happen. Good communication skills in this situation are crucial, and Mr. Powell gave a very clear signal there will be a 0.5% hike next month,” David Madden, market analyst at Equiti Capital told Reuters Thomson Friday.

The Dow Jones index plunged 981.36 points or 2.88 percent Friday to 33,811.40.

The Nasdaq Composite tumbled 335.36 points or 2.55 percent to 12,839.29.

The Standard and Poor’s 500 declined 185.85 points or 2.77 percent to 4,271.78.

On foreign exchange markets, the greenback made substantial gains across the board. The euro retreated to 1.0794 by the New York close Friday. The British pound was sharply lower at 1.2833. The Japanese yen slid to 128.54. The Swiss franc dropped to 0.9568.

The Canadian dollar weakened to 1.2715. The previously high-flying Australian dollar dived to 0.7244. The New Zealand dollar was sold off to 0.6637.

On overseas markets, the Dax in Germany plummeted 2.48 percent. The CAC 40 in Paris, France dived 1.99 percent. In London, the FTSE 100 fell 1.39 percent.

In Japan, the Nikkei 225 tumbled 447.80 points or 1.63 percent to 27,105.26.

The Australian All Ordinaries shed 118.90 points or 1.51 percent to 7,768.20.

In New Zealand, the S&P/NZX 50 fell 45.60 points or 0.38 percent to 11,908.40.

South Korea’s Kospi Composite dropped 22.34 points or 0.82 percent to 2,705.87.

The Shanghai Composite in China was steady, edging up 7.11 points or 0.23 percent to close Friday at 3,086.92.

The Hang Seng in Hong Kong declined 43.70 points or 0.21 percent to close Friday at 20,638.52.