Stock markets in the United States extended losses on Wednesday after Federal Reserve Chair Jerome Powell cautioned that President Donald Trump's tariffs may cause more persistent inflation than previously expected.

Speaking in Chicago, Powell warned that its inflation and employment goals could come into conflict at the moment of making monetary decisions. In such a case, the central bank would assess the distance from each target and the time needed to close those gaps.

At 1:59 pm ET, the Dow Jones Industrial Average index sank 1.79% or 720 points. The S&P 500 lost 2.55%. The Nasdaq 100 sank 3.51%. The euro traded 0.84% higher against the dollar at 1:59 am ET to sell for $1.13834.