The Bitcoin (CRYPTO: BTC) price slipped back below the psychologically important US$20,000 level as most Aussies were just starting their day.
As the sun peaked over eastern shores, the worldâs number one crypto was trading for US$19,793.
The Bitcoin price briefly managed to break back above US$20,000 but in the afternoon, it has dipped back to US$19,995.
Though still commanding an impressive market cap of some US$384 billion, BTC is down a painful 71% since hitting its all-time highs of US$68,790 on 10 November last year.
Why is the Bitcoin price again under pressure?
Bitcoin came under renewed pressure on Wednesday night following an unexpected uptick in inflation figures out of the United States.
Investors had been hoping to see inflation in the worldâs top economy easing. Instead, it went the other direction. Consumer price inflation notched 0.1% higher in August month on month. Core inflation, which takes out food and energy prices, increased a sharp 0.6% from July.
This, of course, bodes poorly for risk assets like the Bitcoin price and most all cryptos. Augustâs higher inflation figures virtually lock in further aggressive tightening by the US Fed, the worldâs most influential central bank.
Commenting on the outlook for rates in the US, head of US economic research at Renaissance Macro Research Neil Dutta said (courtesy of Bloomberg):
The CPI report increases the odds that the Fed hikes by at least another 100 basis points over the November-to-December time frame. This takes the federal funds rate above 4% by year end.
Chief economist at KPMG Diane Swonk agreed, adding, âThe CPI puts a 1% hike on the table, and given the hawkish tone the Fed has delivered, ups the ante they will do it.â
The tech-heavy NASDAQ, a solid proxy for investor risk appetite, shed almost 5% on the news.
The Bitcoin price, which stood at US$22,674 before the inflation figures were released, has lost 12% since then.
The post Why did the Bitcoin price just dip below US$20,000? appeared first on The Motley Fool Australia.
Should you invest $1,000 in Bitcoin right now?
Before you consider Bitcoin, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Bitcoin wasn’t one of them.
The online investing service heâs run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
See The 5 Stocks
*Returns as of September 1 2022
(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}
setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()
More reading
- Why you should buy Block stock (and it’s not Bitcoin)
- As stocks swoon, can crypto get its mojo back?
- Why Bitcoin and Solana are sinking today
- Why Bitcoin plunged on Tuesday
- The Bitcoin price has tumbled 50% in 2022 but this expert says crypto ‘is here to stay’
Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin. The Motley Fool Australia has positions in and has recommended Bitcoin. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
from The Motley Fool Australia https://ift.tt/mPDI1wd
Leave a Reply