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Federal Reserve Chairman Kevin Warsh gave markets no new clues about interest rates on Friday. Speaking at the IMF and World Bank meetings in Bangkok, he refused to say what the central bank will do at its next meeting on October 28.
Traders took his silence as a sign that rates will stay where they are. Bitcoin bounced back toward $82,000 after briefly falling below $80,000 earlier this week.
"We are not in that business anymore"
Warsh joined IMF chief Kristalina Georgieva for a fireside chat. When asked about the path for rates, he said he would not "prejudge" what happens at the meetings left this year.
"It's a new chapter at the Fed, and we're not in that business anymore," he said, talking about the old habit of guiding markets on future moves. He argued that investors should read the economic data themselves instead of waiting for hints.
He also said the Fed would deliver price stability, but gave no date for the next move.
The bet on a hold grows
After the talk, betting markets showed the chance of the Fed holding rates steady in October at more than 85 percent. That is up from about 72 percent a day earlier. The odds of an October hike fell to around 15 percent.
This came after a hot inflation report. US consumer prices rose 3.7 percent in the year to September, up from 3.4 percent in August. That is well above the Fed's 2 percent goal.
Last month the Fed raised its main rate to a range of 3.75 to 4 percent. That was its first increase in three years. President Donald Trump, who appointed Warsh, has pushed for rate cuts, but the Fed raised rates anyway. Trump still says he supports Warsh.
Colleagues agree: no rush
Warsh was not the only Fed official sounding calm. Vice Chair Michelle Bowman said this week that inflation is still too high, but there is "time to wait and see" before taking "more action."
Minutes from the Fed's last meeting showed that most officials think another increase may be needed this year. That would push the next move to December.
For crypto traders, the timing matters. Higher rates make borrowing costly and pull money away from risky assets like Bitcoin. A hold in October would give the market room to breathe.
Bitcoin finds its feet
Bitcoin fell below $80,000 on Thursday for the first time in a month. By Friday it had climbed back toward $82,100 as Asian markets steadied.
Altcoins moved more. Celestia rose about 16 percent, Injective added close to 8 percent, and Ether traded near $2,425.
Stocks had a weaker day. The Dow fell 175 points, the S&P 500 dropped 1 percent, and the Nasdaq lost 2 percent. Long-term US bond yields stayed above 5 percent.
Warsh on AI: a "positive supply shock"
The other big topic in Bangkok was artificial intelligence. Warsh called AI a "positive supply shock" for the economy — probably the most important thing happening in the global economy right now.
He warned it could push prices up in the short term. The rush to build data centers is raising demand for products like memory chips. Over time, though, he said AI should raise productivity and push prices down.
On jobs, he was honest: policymakers do not yet know what AI will do to employment over the next 12 to 18 months. A new Productivity and Jobs Task Force will hold its first field hearing on November 16.
What comes next
The next test is the October 27–28 Fed meeting. If rates stay on hold, Bitcoin bulls will feel they won the round. If prices keep rising into the end of the year, a December hike could come back on the table.
For now, Warsh has left the guessing game to the markets — and the markets are betting on patience.
Sources: New York Post, USA Today, AP/Barchart, TelecomLive/ANI, NewsNation.
