Fed Governor Waller Drops Easing Bias, Bitcoin Falls Below $77K as PCE Hits 3.8%

Waller, once a reliable dove on the Fed, said the labor market has stabilized, shifting his focus to inflation. The PCE index, the Fed’s preferred measure, reached 3.8% in April, nearly double the 2% target. With inflation broadening across goods and services, Waller argued the Fed should appear neutral rather than leaning toward cuts.

On May 22 Waller signaled support for removing the “easing bias” phrasing from FOMC statements. The same day Bitcoin fell from about $79,200 to $76,800, a 3.0% drop, pushing its market cap from roughly $1.55 trillion to $1.50 trillion. The PCE reading of 3.8% marked the highest level since mid‑2023 and underscored persistent price pressures across the economy.

Removing the easing bias does not signal an imminent rate hike; it tells markets the Fed wants to be seen as genuinely neutral. Traders who had priced in near‑term cuts had to re‑evaluate, causing a rapid repricing in risk assets. Bitcoin’s reaction highlights how sensitive crypto remains to shifts in monetary‑policy expectations.