- Kevin Warsh said the Fed remains focused on lowering inflation, with no plans to rescue the crypto industry.
- Warsh reaffirmed the Federal Reserve’s independence, saying politics will not shape monetary policy.
- Bitcoin dipped after the hearing as investors weighed Warsh’s comments on inflation and crypto support.
Federal Reserve Chair Kevin Warsh told lawmakers on Tuesday that the central bank remains focused on bringing inflation under control and will not bail out any sector, including the cryptocurrency industry. Speaking before the House Financial Services Committee in his first congressional testimony, Warsh said restoring price stability remains the central bank’s top priority.
His remarks followed the Federal Reserve’s decision in June to leave its benchmark interest rate unchanged at 3.5% to 3.75% as officials continued to assess inflation and broader economic conditions.
Inflation Remains the Top Priority
Warsh told lawmakers that bringing inflation back under control remains the Federal Reserve’s top priority. “The members of our Committee have no tolerance for persistently elevated inflation. And we share a resolute commitment to restoring price stability,” he said.
Warsh said stable prices are essential to a strong labor market over time, adding that the Fed’s inflation and employment goals support each other when monetary policy is effective.
Fed Defends Its Independence
Lawmakers also questioned Warsh about President Donald Trump’s influence on monetary policy. Warsh said the Federal Reserve remains independent, citing a Supreme Court ruling.
“The Supreme Court said that the Federal Reserve and the conduct of monetary policy is independent,” Warsh said.
He added that politics should play no role in the central bank’s policy decisions and said he would continue carrying out his responsibilities regardless of outside pressure.
Crypto Bailouts Off the Table
Warsh also addressed cryptocurrency during the hearing, saying the Federal Reserve would not provide emergency support to the sector.
“We want to be in a position where we’re not bailing out anybody, including crypto,” Warsh said. He did not link the remarks to any specific cryptocurrency, company or market event.
Following Warsh’s remarks, Bitcoin traded around $64,000, up about 3% over the previous 24 hours, according to CoinMarketCap. Meanwhile, U.S.-listed spot Bitcoin ETFs recorded $424.66 million in net outflows, including withdrawals from BlackRock’s IBIT fund, reflecting continued caution among institutional investors.
The remarks were broadly in line with the Federal Reserve’s existing approach to inflation and financial stability rather than signaling a change in policy.
Related: U.S. CPI Cools, Rate-Cut Hopes Return to Focus
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