Today, the United States Government released a report about the consumer price index, and the news was not great for Bitcoin and other cryptocurrencies.
The report indicated that despite the major Securities and Exchange Commission (SEC) efforts to battle the Nation’s inflation – prices are still rising faster than expected for the American people.
The Consumer Price Index increased 8.2 percent from January to September due to higher prices for rent, food, and other commodities.
These reports further indicate that the United States is in the midst of one of the worst recessions in decades. Despite the SEC raising interest rates to a 14-year-high, the results are still worst than expected.
The world’s economy was on its initial steps of recovering from the harsh effects that the pandemic had on countries all around the world. To make things worse, the Russia-Ukraine war affected the world’s economies due to sanctions on Russia harshly affecting prices of Russian commodities like natural gas and certain foods.
For example, American Healthcare costs rose by around 28% in the span of one year, while everyday products like groceries rose by 13% – the effects of inflation makes lower and middle-class lives significantly more difficult.
Bitcoin Feels The Effect Of CPI
Bitcoin (BTC) fell by almost 3% reaching one of the lowest marks of the year. The largest cryptocurrency by market value was valued at about $18,400.
The Federal Reserve’s constant efforts to control inflation have severely impacted cryptocurrencies since September. As U.S. interests raise, risky assets like cryptocurrency and stock tend to lose value due.
Since the Federal Reserve’s efforts to cool off skyrocketing inflation have driven down prices for financial assets viewed as risky, from equities to bitcoin, cryptocurrency traders regularly monitor monthly inflation numbers.
BTC Holding Steady At The $19,000 Zone
Despite going through several horrible news, Bitcoin refuses to abandon the $19,000 zone.
Ever since Bitcoin’s major crash in June, BTC fell by 41% when several whales withdrew funds in BTC ahead of the dreaded “crypto winter” – Bitcoin has mostly been trading sideways for the last 4 months.
On June 18th – Bitcoin reached the US$19,000 mark for the first time in 2 years (before the Bitcoin boom during the pandemic).
Ever since then, the cryptocurrency has failed to pick itself up, never surpassing the US$24,000 mark.
However, that $19k resistance zone has proven to be a reliable “bottom” for Bitcoin so far.
