Bitcoin’s Price Raises Concern As Market Stands Divided On Upcoming Interest Rate Hike
An unexpected drop in wholesale prices was seen in February, which provides some hopeful news regarding inflation at a time when the Federal Reserve is weighing its next step with regard to interest rates. According to a report that was released by the Labor Department on Wednesday, producer price increases (PPI) fell to an annual pace of 4.6% in February, which is a considerable decrease from 6% in January.
Brewing Market Uncertainty
The cryptocurrency market is currently split on whether or not a rate hike of 25 basis points should be implemented in response to a report indicating cooling inflation — and on the possibility of a no hike due to the ongoing banking crisis. This uncertainty has marginally affected Bitcoin’s price as it slips below $25K leaving investors and traders in the doldrums.
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However, few experts are of the opinion that inflation will continue to persist in the country for the foreseeable future and won’t be eliminated any time soon. Notable crypto expert Michael van de Poppe recently suggested in a tweet that the US inflation is likely to continue, which would result in a drop in Bitcoin’s price before the next meeting of the Federal Open Market Committee (FOMC).
Bitcoin’s Price To Fall?
Poppe also mentioned that although the CPI and PPI data turned out mostly favorable, there is evidence that inflation would persist for a longer period of time than was anticipated. This in turn could lead to a drop in Bitcoin’s price as the market remains largely uncertain about the Fed’s next move. Furthermore, even though BTC has shown immense strength in the midst of the U.S. banking crisis, speculative trading action could lead to a significant downtick in BTC’s price.
Additionally, it should be noted that BTC’s technical analysis (TA) indicators at CoinGape’s crypto market tracker recommend a “Buy” position as summarised by its moving averages. And, as things currently stand, the price of Bitcoin (BTC) is trading at $24,254 which represents a drop of 4.64% over the past 24 hours, in contrast to a gain of 10.76% recorded over the last seven days.
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