(NewsNation) — Financial markets rallied in response to Federal Reserve Chairman Jerome Powell saying that interest rate hikes will begin to slow down.

The S&P 500 jumped 122 points, or 3.1% on Wednesday. It had fallen before Powell spoke.

Investors are reviewing the latest update on inflation. A measure of inflation that is closely monitored by the Fed eased in October. Wall Street has been closely watching any updates about inflation to get a better sense of whether the Fed will tone down its aggressive interest rate increases.

The central bank has been deliberately slowing the economy to tame stubbornly hot inflation. Prices have been falling, but remain historically high.

Meanwhile, NewsNation business contributor Lydia Moynihan said consumers likely won’t see rates go up much higher over the next few months, maybe by about “25, 50 basis points.”

“Mortgage rates are probably going to stay about where they are now, maybe go a little bit higher. But for borrowers, we’re still going to continue to feel the pinch in the short term,” Moynihan said. “Of course, all of this hinges on the fact that we need inflation to keep going down for interest rates to subside.”

Powell also signaled that the Fed may increase its key interest rate by a half-point at its December meeting, which will take place Dec. 13-14, a smaller boost after four straight three-quarter point hikes. Rate increases could then fall to a more traditional quarter-point size at its February and March meetings, based on previous Fed forecasts.

It has lifted the rate six times this year to a range of 3.75% to 4%, the highest in 15 years. Those increases have sharply boosted mortgage rates, causing home sales to plunge and raising costs for most other consumer and business loans.