Federal Reserve Governor Lisa Cook said she is prepared to support higher interest rates if US inflation fails to come down, a change that can pressure crypto and other high-risk investments.

Cook was speaking at a luncheon hosted by the Anchorage Economic Development Corporation, saying that while some disinflationary forces are in play, she is “prepared to act” if disinflation stalls.

“As I have described, inflation is too high, and I consider the risks to the inflation side of the dual mandate higher than the risks to the employment side at this point,” said Cook. “As such, I am prepared to act by raising rates, if necessary.”

The US Federal Reserve is targeting an annualized inflation rate of 2% over the long run. The annual inflation rate fell to 3.5% in June 2026, the first decline in five months, according to Trading Economics.

However, Cook said she would not put too much weight on a single data point, given a highly uncertain environment, adding that the personal consumption expenditures price (PCE) index rose 3.7% in the 12 months through June, nearly double its 2% target.

“If I do not see signs of continued disinflation soon, I am prepared to act,” Cook said.

“With five years of above-target inflation, the risk grows that higher inflation may become entrenched in price- and wage-setting behavior, leading to persistence that would be much harder for us to attack. The longer inflation is above target, the more likely this scenario becomes.”

Related: US hints at more yen intervention: Five things to know in Bitcoin this week

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The euro and the pound continue to trade higher against the US dollar following last week’s Federal Reserve meeting. As widely expected, the Fed left interest rates unchanged and reiterated that future monetary policy decisions would depend on incoming economic data. This cautious stance failed to provide fresh support for the dollar, while yesterday’s weaker US labour market figures added further downward pressure. According to the latest ADP report, the US private sector added just 44,000 jobs, well below forecasts of 68,000 and the previous month’s 95,000. Although the S&P Global Services PMI exceeded expectations, the ISM report painted a more mixed picture: the headline services index edged down to 54.1, while the employment component fell to 47.4, signalling continued cooling in the labour market. As a result, investors increased their expectations of a broader slowdown in the US economy, allowing both the euro and the pound to maintain their upward momentum.

EUR/USD

EUR/USD rallied strongly last week, breaking above the key resistance level at 1.1500. Since the start of this week, the pair has been trading sideways between 1.1500 and 1.1560 as investors await fresh macroeconomic data. Technical analysis suggests the bullish trend could extend towards 1.1600–1.1620 if the 1.1560 level becomes established as support. Conversely, a sustained move below 1.1500 would weaken the bullish outlook.

Key events for EUR/USD:

• Today at 09:00 (GMT+3): German Factory Orders;
• Today at 10:30 (GMT+3): Germany S&P Global Construction PMI;
• Today at 15:30 (GMT+3): US Initial Jobless Claims.

GBP/USD

GBP/USD is showing a similar pattern, consolidating between 1.3420 and 1.3480 after last week’s sharp advance. A decisive break above 1.3480 could pave the way for a retest of the July high near 1.3560. On the other hand, stronger-than-expected US economic data could push the pair back towards the 1.3350–1.3400 range.

Key events for GBP/USD:

• Today at 11:30 (GMT+3): UK Construction PMI;
• Today at 18:30 (GMT+3): Atlanta Fed GDPNow estimate;
• Tomorrow at 15:30 (GMT+3): US ADP Private Non-Farm Employment Change.

The official US Nonfarm Payrolls report remains the key event for currency markets this week. Employment growth, the unemployment rate and wage data will provide investors with a clearer picture of the strength of the US economy and help shape expectations for future Federal Reserve policy. If the figures confirm further signs of labour market cooling, the dollar could come under renewed pressure, allowing EUR/USD and GBP/USD to extend their recent gains. Stronger-than-expected data, however, could revive demand for the US dollar and trigger a correction in both European currencies.

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Rob Hamilton, who is building the automated setup the group runs, said in an X post the bottleneck is not finding bugs but routing them to the right maintainers.

“The hardest part is coordinating to get things to the right people,” Hamilton wrote. “While it is powerful, having found critical issues, I would view this as only version one.”

The audit lands in an ecosystem already absorbing the fallout when the other side finds a flaw first.

The Coldcard sweeps, which began July 30 and have taken as much as $114 million from wallets whose seeds were generated by faulty firmware, stemmed from a bug that had been dormant since 2021 and required no access to the physical device once the affected key space was known.

Attackers already have the same tools, however.

Anthropic said in April that one of its models, held back from public release and given only to vetted users, found a bug that had sat undiscovered in widely used software for 27 years, at a cost of less than $50. It found flaws in the encryption software that secures banking connections, exchange logins and the servers running most of the internet.

Separately, Google’s threat intelligence team said in May it had caught a criminal group preparing an attack built on a flaw a model had found for them.

Bitcoin hovered near $64,830 on Thursday, up 0.8% over 24 hours and 1.3% on the week, while trading inside a narrow band, CoinDesk data show. Ether rose 2.1%, but most other majors barely moved, leaving the market less in rally mode than in wait-and-see mode.

The bid under bitcoin is coming from macro hopes rather than fresh crypto demand. President Donald Trump pointed to strong employment, better manufacturing data and cooling inflation, while also raising the possibility of a deal to reopen the Strait of Hormuz.

A reopening would likely pressure oil lower, easing inflation worries and giving Treasury yields and the dollar room to fall. That is the setup risk assets want, and bitcoin is trading like some of it may arrive.

The problem is that the trade still depends on several steps lining up. Lower oil has to feed into lower inflation expectations. Lower inflation expectations have to pull down real yields and the dollar.

Its roughly 63% correlation with the S&P 500 also means equity sentiment may matter more than crypto-native flows in the near term. A calmer Middle East backdrop helps risk appetite, but it can also reduce the safe-haven demand that supported bitcoin earlier in the summer.

The levels to watch are real yields and the dollar. If both fall alongside oil, bitcoin has a cleaner path above the top of its recent range. If yields stay firm, the macro case remains theoretical and bitcoin likely stays pinned near $65,000.