Former Goldman Sachs Group Inc. President Gary Cohn said the Federal Reserve needs to “take a deep breath” after rate hikes meant to fight inflation hurt the banking sector.

“I would like the Federal Reserve to stop,” Cohn, a top economic adviser in the Trump White House who is now vice chairman at International Business Machines Corp., said in an interview with Barry Ritholtz on Bloomberg Radio’s “Masters in Business” podcast. “Right now in the tightening cycle, we’ve almost seen more damage in the regional banks than we have seen help for the US economy.”

Cohn said that this year’s string of bank failures — which were sparked when higher interest rates eroded the value of long-dated assets and encouraged deposit flight —  will motivate the Fed to increase capital requirements for the largest US lenders. But he was skeptical of the benefits to that approach.

“Because of what happened in the regional banks, we now have a Federal Reserve that thinks banks need more capital, so we’re going to put more capital into the biggest banks,” Cohn said. “They don’t need more capital.”

In a rate decision on Wednesday, the central bank kept its target for the federal funds rate unchanged at 5.25% to 5.5%, but Chair Jerome Powell signaled that another hike is likely this year.

Cohn said that there has never been a period in which the Fed has been tightening monetary policy to rein in inflation even as the federal government increases spending. He said that government initiatives including the Chips Act and the infrastructure program would create continued labor market demand even as higher rates weighed on the housing market.

If he had a chance to sit down with Powell, Cohn said, he’d tell him the following: “I think you’ve done enough.”

This article was provided by Bloomberg News.