The Bank of Japan stated in its quarterly outlook report that global AI-related demand may exert lasting upward pressure on Japan's inflation, suggesting that AI-driven investment could outweigh productivity gains in the short term and strengthen the case for a near-term interest rate increase.
Federal Reserve Chairman Kevin Warsh testified before Congress for the first time on Tuesday, pledging to make high inflation "a thing of the past" and calling for "regime change" at the central bank. He also vowed to "do my job" if challenged by President Trump, his most direct comment yet on maintaining Fed independence.
The European Central Bank's digital euro initiative has progressed from initial exploration to broader institutional and financial sector alignment by 2026, as European institutions increasingly converge on the strategic rationale for a euro-denominated central bank digital currency.
European Central Bank board member Isabel Schnabel stated that increased stablecoin use could reinforce the dollar's global dominance, undermine some nations' monetary policy autonomy, and diminish the role of the euro.
The Federal Reserve maintained interest rates unchanged in what is expected to be Jerome Powell's final FOMC meeting as chairman, with a split 8-4 vote creating uncertainty around future policy. Kevin Warsh cleared Senate Banking Committee approval to become the next Fed chair.
