Bitcoin Slides Below $71K as Powell Flags Oil Prices as Inflation Risk
Bitcoin dropped below $71,000 Wednesday after Federal Reserve Chair Jerome Powell highlighted rising energy prices amid the Iran war as a potential driver of higher inflation. BTC traded near $69,494 following the Fed’s decision.
The central bank held interest rates steady as expected. During his post-meeting press conference, Powell noted that surging oil prices are already influencing the Fed’s outlook. “The oil shock for sure shows up” in inflation projections, though he cautioned that “nobody knows” how long the effects might persist.
The Fed raised its 2026 inflation forecast to 2.7% from 2.4%, signaling concern that price pressures may remain elevated. Powell dismissed stagflation comparisons, emphasizing that unemployment is near long-term norms and inflation is only modestly above target. “We have some tension between our goals, and we’re trying to manage our way through it,” he said.
Markets were already under pressure from weak February inflation data and geopolitical tensions. Bitcoin later fell to around $70,900, down nearly 5% over 24 hours, while Ether (ETH) declined 6.5%.
U.S. stocks closed at session lows, with the S&P 500 down 1.4% and Nasdaq off 1.5%. Gold slipped 3.1% to below $4,850 an ounce, its lowest level in over a month.
Crypto-related stocks followed suit: Strategy (MSTR) and Bitmine (BMNR) fell 5%-6%, Galaxy (GLXY) dropped nearly 7%, and Gemini (GEMI) plunged 15% to near its lowest price since going public last year.
