Bitcoin (BTC) rose back toward the $60,000 level on Wednesday after Federal Reserve Chair Kevin Warsh said inflation risks had eased, while reiterating the central bank’s commitment to its 2% inflation target.
Warsh did not signal the Fed’s next rate move, saying policymakers would evaluate incoming data at their meeting in four weeks during a panel at the European Central Bank’s annual forum in Sintra, Portugal.
He instead underscored that the Fed’s focus remains firmly on price stability.
“Inflation risks have come down,” Warsh said, adding that expectations of the Fed tolerating inflation above 2% would be mistaken. “We’re going to deliver price stability in the U.S.”
Following the comments, bitcoin reversed earlier declines and traded back near $60,000, up more than 2% over the past 24 hours, according to CoinDesk data.
Warsh also highlighted artificial intelligence as a potentially transformative force for the U.S. economy, saying the current surge in AI-driven capital spending is boosting demand in the near term but may ultimately expand the economy’s supply side.
He noted that, unlike previous cycles driven by financial engineering such as share buybacks, companies are now investing based on expectations that AI will meaningfully improve productivity. If realized, that shift could carry significant implications for monetary policy, though he cautioned it remains too early to assess.
The discussion also included European Central Bank President Christine Lagarde, Bank of England Governor Andrew Bailey, and Bank of Canada Governor Tiff Macklem, who broadly agreed that central banks should move away from strict forward guidance.
Lagarde said she favors “framework guidance,” where the ECB explains its decision-making process without committing to a preset interest-rate path. Warsh echoed that view, arguing that policymakers should prioritize correct decisions over communication tools that may constrain flexibility.
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