Bitcoin Drops Below $19,000 After US Inflation Report
- July 13, 2022
- 0
At the end of June, the growth rate of the consumer price index in the USA increased from 8.6% in May to 9.1% on an annual basis. Against
At the end of June, the growth rate of the consumer price index in the USA increased from 8.6% in May to 9.1% on an annual basis. Against this background, Bitcoin immediately dropped below $19,000.
The figure exceeded analysts’ expectations (8.8%). On a monthly basis, however, growth was 1.3% versus the predicted 1.1%. The inflation rate was the highest since November 1981.
At the time of writing, the initial cryptocurrency is trading above $19,330. Over the past day, the price of the asset has dropped 3% (CoinGecko).
The other day, Ethereum lost 3.3%. At the time of writing, the coin is hovering around $1,050.
Following the flagships, all crypto assets in the top 10 with capitalization moved into the red zone.
The total capitalization of the cryptocurrency market fell by 2.6%. Currently, the figure has dropped to $897.5 billion.
According to Coinglass, $12.7 million was liquidated in the past hour and $242.3 million per day in the futures market.
US stock indexes also reacted negatively to the news: the S&P 500 fell 0.75% and the Nasdaq Composite 0.43%. The Dow Jones Industrial Average lost 1.02%.
In March 2022, the US Federal Reserve System (FRS) increased its key rate by 25 basis points for the first time since December 2018. is – up to 0.25-0.5%. Then Bitcoin and S&P 500 showed growth.
Markets were surprised when the Fed increased the interest rate range to 0.75-1% per annum in May. Against this background, the price of the first cryptocurrency currently surpassed the $40,000 level, but fell below $36,000, the start of a long correction, on the same day.
In June, the Fed raised the key interest rate by 75 basis points to 1.5-1.75%. Bitcoin, which could not exceed the level of $ 30,000 with the news of accelerated annual inflation, reacted with growth.
Recall that according to Coinglass, the second quarter of 2022 was the worst quarter for digital gold in the last 11 years. The asset fell 56.2% from $45,000 to $19,884.
According to Mike Novogratz, head of Galaxy Digital, the stagnation in the cryptocurrency market will continue for about 18 more months, and the industry will see the first signs of recovery after the Fed eases its monetary policy.
Anticipating the 2007 mortgage crisis, investor Michael Burry predicted an ongoing decline in bitcoin price.
Read how the Fed rate affects the prices of the first cryptocurrency on ForkLog cards.
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Source: Fork Log
I’m Sandra Torres, a passionate journalist and content creator. My specialty lies in covering the latest gadgets, trends and tech news for Div Bracket. With over 5 years of experience as a professional writer, I have built up an impressive portfolio of published works that showcase my expertise in this field.
