- The US inflation rate hit 9.1% in June 2022, the highest level since 1981, signaling that Fed officials could shift interest rate hikes at a faster pace.
- Bitcoin price tumbled in response to the surge, falling to $19,100 at the time of writing.
- Analysts predict that the price of Bitcoin could hit yearly lows if the downward trend continues.
The price of Bitcoin reacted negatively to the US CPI data., erasing the earnings of the previous day. The inflation rate reached 9.1% year-on-year in June 2022, the highest level in four decades. Analysts expect Bitcoin price to plummet to yearly lows if the bulls fail to take control.
Bitcoin and Stock Markets Fall in Response to Rising US CPI
Following the release of the US CPI consumer price index data, the price of Bitcoin fell, and stock futures turned negative. Bitcoin holders closely followed the data for clues about the Fed’s monetary policy outlook and the impact on the entire market.
US inflation reached its highest point since 1981, rising to 9.1% in June 2022. While Bitcoin and Ethereum erased their gains from the previous dayexperts predict that the asset will plunge to its yearly lows at the current rate of decline.
The June 2022 CPI reading was higher than the May annual rate of 8.6%. Fed officials have switched to a faster pace of interest rate increases. This implies that the outlook for inflation has worsened, and the pace of interest rate hikes could slow the economy.
The price of Bitcoin once again lost important support at the $20,000 leveland analysts believe the asset is likely to retest its yearly low.
Martin Froehler, CEO of Morpher, argues that the price of Bitcoin will fall below $12,000 before starting to rise to $40,000 by the end of 2022.
Bitcoin price fell below its support in $19,126; analysts believe that the maximum pain scenario is a fall to $18,000 and lower.
BTC/USD chart
Source: Fx Street
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