Warsh Whispers "Easier" and Gold/Bitcoin Throw a $1.25T Welcome Party 🪙

Bitcoin reclaimed $60,000 on Wednesday after Federal Reserve Chair Kevin Warsh said inflation risks had eased and struck an open-minded tone on artificial intelligence, reviving appetite for risk assets and precious metals. BTC traded near $60,088, up about 2.8% in 24 hours, lifting its market value above $1.2 trillion. Ethereum rose roughly 3.3% to near $1,619.

Warsh's comments came during a panel at the ECB Forum on Central Banking in Sintra, Portugal, his first international appearance as Fed chair. A longtime inflation hawk who served on the Fed board through the 2008 financial crisis before resigning in 2011 over a $600 billion bond-buying plan, Warsh pointed to easing price pressures since taking office. "Inflation risks have come down." He added, "We're all in the price stability business … we've all looked around and we've seen that prices are too high." Traders judged his tone less hawkish than his June debut.

The Fed held rates at 3.5% to 3.75% in June after U.S. consumer prices rose 4.2% year-on-year in May, the fastest since 2023, with oil lifted by the war with Iran. Fears of a possible hike eased after oil retreated in late June. On AI, Warsh called it a productivity driver but declined to judge its inflation impact. As he told Nick Timiraos: "I'm not going to make a judgment now." Cleveland Federal Reserve President Beth Hammack had earlier said of hyperscaler demand, "What they say is that the demand is insatiable… these companies, these hyperscalers, will pay almost any price for those inputs, and they need things built yesterday."

Bitcoin's bounce followed a steep slide to its 2026 low near $58,000 last week, a move that came after hot May inflation data triggered $1.26 billion in liquidations. BTC remains down about 16% from a month ago. Gold rallied alongside crypto, hitting an intra-day high of $4,115 after sliding to multi-month lows earlier in the week, with silver also gaining as bets on aggressive tightening receded.