A top Federal Reserve official said the central bank may not lower interest rates as expected if it doesn’t see progress on lowering inflation, a statement that raised fear in markets.

Federal Reserve Bank of Minneapolis President Neel Kashkari, one of the voting members of the Federal Open Market Committee, acknowledged that the Fed might not cut interest rates this year as inflation remains stubbornly sticky. That possibility clashes with investors and even the Fed itself, which is predicting coming rate revisions.

“In March, I had jotted down two rate cuts this year if inflation continues to fall back towards our 2% target,” Kashkari said during an event on Thursday. “If we continue to see inflation moving sideways, then that would make me question whether we needed to do those rate cuts at all.”

The two rate cuts he was referring to were predicted during the FOMC’s meeting last month. At every other meeting, Fed officials make projections for coming rate changes and metrics inflation, unemployment, and gross domestic product.

A majority of FOMC members said they predict three interest rate cuts this year, although a sizable number of participants, like Kashkari, projected just two interest rate cuts.

Kashkari’s remarks sent shudders through the markets, with the Dow Jones Industrial Average plunging more than 500 points on Thursday afternoon and the tech-heavy Nasdaq losing about 1.4% of its total value.

The stock market favors lower interest rates, so hearing that even just one Fed official thinks there is a possibility of no rate cuts is enough to spook investors. Generalized anxiety on Wall Street is captured by the Chicago Board Options Exchange Volatility Index, better known as VIX but also as the “fear index.” The VIX was up more than 14% on Thursday.

Recent inflation reports have not been the greatest news for the central bank.

Inflation is now running at 3.2% over the past year, according to the latest consumer price index data.

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The Fed’s preferred inflation gauge also ticked up slightly in February, although Fed Chairman Jerome Powell said that its findings are about in line with FOMC expectations.

“We don’t see it as likely to be appropriate that we would begin to reduce interest rates until the committee, the Federal Open Market Committee, is confident that inflation is moving down to 2% on a sustained basis,” he said during an event.