On the second day of the Fed Chair’s testimony before Congress Jerome PowellMarket indices showed mixed signals, but key interest rate-sensitive sectors reacted negatively.

Powell’s comments before the Senate Banking Committee point to a possible fresh 0.5% hike later this month did not go down well with investorswhich were pricing in a 0.25% hike on the expectation that the Fed would repeat the same rate hike from early February.

Rich against 0.5% rate hike in March: Robert Reichformer Secretary of Labor bill clintonsaid it would be a big mistake to raise interest rates higher than expected.

“It puts the burden of inflation entirely on the low-wage and the poor,” the political commentator said on Twitter. Reich also worked under Jimmy Carter, Gerald Ford And Barack Obama.

in one blog entry On Tuesday, Reich criticized the approach of continuing to hike rates if spending continues to thrive, insisting that “Americans who spend most of the time are not the ones who will be hit the hardest by rate hikes.” .

While the top quintile of the income ladder is making the spending that drives current economic resilience, the bottom quintile would see job losses as the economy slows, he said.

In his view, there is no need to raise interest rates any further as inflation is already decelerating, and he said that fixing a 2% target could end up hurting more than it could cure.

“Why not 4%? Bringing inflation down to 2% will cause too much pain for the most vulnerable,” he wrote.

Unemployment was a major focus among senators from both parties, including the Democrats Elizabeth Waren and Republicans John Kennedywho expressed concern about the possibility 2 million people will lose their jobs this year because of higher interest rates.

On Tuesday, the S&P 500 fell 1.5%, the Nasdaq Composite fell 1.3% and the Dow Jones Industrial Average fell 1.7%.

While Powell said no decision had yet been made, he laid the…