Bitcoin Price Dropping?
Bitcoin Price Dropping: Bitcoin’s price has increased by 1.5% in the last 24 hours but has decreased by 4% in the last seven days. At $19,321, this indicates a significant 10.5% drop in the last 30 days, and given the likelihood that the Federal Reserve – and other central banks – will continue to raise interest rates, the original cryptocurrency is expected to suffer further losses.
With inflation at an all-time high and the current Ukraine-Russia war likely to keep gasoline and food prices rising, the macroeconomic outlook is unlikely to change in the near future. However, other countries have reported lowering inflation rates, and Ukraine has made headway in recapturing areas of its territory previously seized by Russian forces in recent weeks.
Bitcoin Price Continues to Slide
Most months in 2022 have seen a fall in bitcoin prices, and September is no exception. BTC is down 55% year to far, and after a brief rally over $22,500 in the run-up to the Merge, it has since dropped 14%.
BTC’s indicators indicate that it is still in a downtrend. In purely technical terms, it should climb again shortly, especially given that it is still 72% lower than its all-time high of $69,044.
Of course, indicators do not promise anything, and the economic situation remains bleak. The Federal Reserve is scheduled to publish its latest monetary policy decision today at 2 p.m. EDT (1800 GMT), and reports suggest that it will raise its base rate by another 0.75%, bringing it up to the 3%-3.25% range.
Tellingly, a 0.75% rise would take interest rates to their highest level since 2008, at the height of the financial crisis. And with inflation at 8.3% in the US and 9.1% in the EU, rates are likely to remain high for a while yet, putting prolonged pressure on bitcoin’s price.
Hopeful Signs
There won’t be a significant recovery until at least early 2023, although there are some indications that the economy has reached peak inflation and interest rates.
For one thing, inflation rates in certain nations have begun to slow and/or reverse. In the United Kingdom, inflation declined by 0.2% between July and August, but it remained high at 9.9%.
Oil prices have also fallen slightly in recent weeks after reaching all-time highs in the aftermath of Russia’s intervention into Ukraine, though they remain high. Food costs follow a similar pattern, albeit they still have some room to fall.
Both oil and food are linked to the war in Ukraine, and while no immediate end to this conflict is in sight, it’s worth noting that Ukrainian forces have reclaimed considerable stretches of land in recent weeks.
This morning, Russian President Vladimir Putin responded to setbacks by imposing partial conscription, but while boost his forces may prolong the conflict further, the move could also be read as a sign of desparation.
Regardless of the timing, nothing has changed fundamentally for Bitcoin since the start of 2022. It has attracted growing interest from banks and financial institutions, with trillion-dollar asset manager BlackRock launching its own private bitcoin spot fund in August.
As such, it’s still in a position to rally again when conditions are more favorable. But for now, it could dip a little more if the Fed goes through with its expected rate hike in a few hours.
SOURCE: www.ghnewslive.com