Bitcoin Drops Below $71K as Powell Flags Oil-Driven Inflation Risks
Bitcoin fell below $71,000 Wednesday after Federal Reserve Chair Jerome Powell warned that rising energy prices amid the Iran war could boost inflation. BTC traded near $69,494 following the Fed’s decision.
The central bank held interest rates steady as expected. Powell noted during his post-meeting press conference that the recent oil surge is already feeding into the Fed’s outlook. “The oil shock for sure shows up” in inflation projections, though “nobody knows” how persistent the impact will be.
Fed officials raised their 2026 inflation forecast to 2.7% from 2.4%, signaling concerns that price pressures could remain elevated. Powell dismissed stagflation comparisons, noting unemployment remains near long-term norms and inflation is only modestly above target.
Markets had already been pressured by weak February inflation data and geopolitical tensions. Bitcoin later dropped to $70,900, down nearly 5% in 24 hours, while Ether (ETH) fell 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. Crypto-related stocks mirrored losses: Strategy (MSTR) and Bitmine (BMNR) fell 5%-6%, Galaxy (GLXY) dropped 7%, and Gemini (GEMI) plunged 15%, near its lowest price since going public.
