US indices fell on Thursday, after stocks plummeted due to rising inflation and regional coronavirus outbreaks. To be more specific, the energy and technology sectors led Wall Street lower, so S&P 500 sank 0.3%.

But despite the ongoing increase in inflation, Fed Chairman Jerome Powell said the central bank will adopt a flexible stance on monetary policy, as they expect a short spike in price pressures amid another COVID-19 outbreak. Of course, some are fearing a more sustained inflation that could hurt the economic outlook.

"At least for the next 12 to 18 months, we're going to be living in a period of heightened inflation pressures," said Sean Darby, a strategist at Jefferies. "The good news is at least for the next 12 months, I don't think the profit cycle is going to pull the rug from under the feet of equity investors. It's still a reasonable environment for equity markets to outperform other asset classes. "

Powell said the US is yet to achieve a complete recovery, so the Fed still can not end its support programs.

Treasury Secretary Janet Yellen also said she expects "several more months of rapid inflation," and that expectations for price increases remain subdued.

But St. Louis Fed President James Bullard argued that bond purchases should be reduced already because there is significant progress on both inflation and employment.