Bank of America, Barclays and Jefferies said they now see a 75-basis points interest rate hike. Before Barclays had said it could be a 50- or 75-basis point increase, while Bank of America and Jefferies were betting on a 50-basis point rise.

Federal Reserve Chair Jerome Powell said the central bank is "strongly committed" to bringing inflation down and needs to keep going until it gets the job done.

Chicago Fed President Charles Evans joined his fellow policymakers in saying that reining in inflation is "job one."

Investors are also awaiting the U.S. August inflation report next week for fresh clues on whether the Federal Reserve will hike rates by half or three-quarters of a percentage point at the next policy meeting due Sept. 20-21.

Worries over aggressive monetary tightening across the globe stalled equity markets on Thursday after the European Central Bank hiked interest rates by an unprecedented 75 basis points and signaled further hikes.