With the increase in the inflation rate in the United States, the price of bitcoin is expected to drop below the $27,000 mark

The price of bitcoin extended its losses after the flagship currency dipped below $30,000 and this price action was seen for the first time since July 2021. The currency rallied a little as it tried to hold on to 30,000 $.

However, the world’s top cryptocurrency once again dipped below $30,000 just after news broke that inflation was much higher than expected.

Currently, the price of bitcoin is trading at $29,081 with a decline of 7.24% in the last 24 hours. This fall of bitcoin follows that of US stock futures, which tumbled after US CPI data showed an 8.3% increase in April.

No sign of serenity in the CPI data

Although the CPI reports are lower than March’s 8.5%, the data shows that prices are not going to calm down anytime soon and will take much longer than expected.

High inflation indicates that there will be an interest rate hike this year by the US Federal Reserve and other central banks. This action will also have a negative impact on the cryptocurrency market.

Last week, the interest rate hike by the Federal Reserve had already brought the flagship currency under pressure and with this new development, the price of bitcoin is expected to plunge below the $27,000pushing for greater selling pressure.

The surge in inflation is the result of prolonged unsecured monetary policy and Russia-Ukraine.

The cryptocurrency market will suffer further losses

Indicated fear of an interest rate hike by the Federal Reserve had hung over the cryptocurrency market since the start of the year, leading to a 50% drop in the price of bitcoin from its all-time high. historical.

Today, the capitalization of the world market for cryptocurrencies rose 12.91% in the past 24 hours to $1.24 trillion, down more than $800 billion this year.

The current scenario will see more pressure on the market for cryptocurrencies, as traders will have to adapt and move with rising interest rates this year.

Leave a Comment