U.S. stocks and oil tumbled on Friday while bond yields continued to gain as investors prepared for a bevy of interest rate hikes in a global inflation fight.

All three major indices on Wall Street steepened their losses one day after Federal Reserve Chairman Jerome Powell indicated that the U.S. central bank was preparing a half-point interest rate hike at its upcoming May meeting, with more to come.

The Dow Jones Industrial Average (.DJI) was down 1.84% in afternoon trading, while the S&P 500 (.SPX) lost 1.90% and the Nasdaq Composite (.IXIC) dropped 1.86%.

The MSCI world equity index (.MIWD00000PUS), which tracks shares in 45 nations, fell 1.93%.

Powell drove headlines on Thursday when he said a 50 basis point rate hike is “on the table” at the Fed’s next meeting, adding that it “is appropriate to be moving a little more quickly” to combat inflation. read more

“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,” said David Madden, market analyst at Equiti Capital.

The prospect of aggressive hikes was a boon to the U.S. dollar, which surged to a more than two-year high on Friday. The dollar index

The dollar’s surge took a toll on fellow safe-haven gold, with spot gold prices falling 0.86% to $1,934.68 an ounce.

Yields on U.S. Treasury bonds were also on the uptick as traders prepared for higher rates, with short-dated bonds hitting three-year highs in Friday trading.

Two-year note yields , which are highly sensitive to interest rate moves, rose to 2.789%, the highest since December 2018, before dipping lower to 2.7134% in the afternoon. Benchmark 10-year yields were last at 2.9064%, after reaching 2.981% on Wednesday, also the highest since December 2018.

“We’re repeating the same message from central bankers, and every time each repetition ratchets short interest rates higher,” said Jim Vogel, an interest rate strategist at FHN Financial in Memphis, Tennessee.

European stocks (.STOXX) finished down 1.76%, with France’s CAC 40 (.FCHI) down 1.99% ahead of Sunday’s presidential run-off vote. Britain’s FTSE (.FTSE) fell 1.39%.

Oil looked set for a weekly decline Friday, as concerns of looming interest rate hikes, weaker global growth and COVID-19 lockdowns in China hurting demand outweighed a potential European Union ban on Russian oil that would tighten supply.

Brent crude was last down 1.82% at $106.36 a barrel, while U.S. West Texas Intermediate (WTI) crude declined 1.97% to $101.76.

The oil price has been increasingly volatile in recent months.

Since the creation of the Brent futures contract, there have been only 29 days when the spread between the intra-day high and low was $8 a barrel or more. Of those, 16 have occurred this year.