Bitcoin Falls Below $71K as Fed Signals Persistent Inflation Risks

The Federal Reserve kept interest rates unchanged, but comments from Chair Jerome Powell shifted market sentiment. Policymakers raised their 2026 inflation forecast to 2.7% from 2.4%, citing rising energy prices linked to geopolitical tensions. Powell noted that oil price shocks are already influencing inflation expectations, though the long-term impact remains uncertain.

Bitcoin dropped below $71,000, trading near $70,900 and extending losses to nearly 5% over 24 hours. Broader markets followed a similar pattern, with the Nasdaq and S&P 500 closing at session lows, down 1.5% and 1.4% respectively. Ether also declined sharply, losing more than 6%.

Gold Prices and Investor Sentiment

Gold weakened alongside risk assets, falling below $4,850 per ounce, its lowest level in over a month. The combined pressure from fading rate cut expectations and persistent inflation concerns has pushed investors toward a cautious stance.

Market Outlook Amid Policy Uncertainty

Despite concerns, Powell rejected comparisons to stagflation, pointing to stable employment and only moderately elevated inflation. However, markets remain sensitive to energy prices and monetary policy signals, suggesting continued volatility across crypto and traditional assets.

Disclaimer

This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.