bitcoin fell below $71,000 on Wednesday as Federal Reserve Chairman Jerome Powell pointed to rising oil prices amid the war in Iran as a new inflation risk.
The Federal Reserve kept interest rates steady as expected, but during his post-meeting press conference, Powell acknowledged that the recent surge in energy prices is already weighing on the central bank’s outlook.
“The oil shock is surely reflected” in projections of higher inflation, he said, although he warned that “no one knows” yet how persistent the impact will be.
Authorities raised their 2026 inflation forecast to 2.7% from 2.4%, underscoring concerns that price pressures could remain elevated longer than expected.
Despite that, Powell dismissed comparisons to 1970s-style stagflation, even as the central bank faces growing tension between slowing growth and sticky inflation.
“That’s not the case now,” he said, noting that unemployment remains close to long-term norms while inflation is only modestly above target. “I would reserve the term stagflation for a much more serious set of circumstances.”
“What we have is a certain tension between the objectives and we are trying to manage it,” he added.
Cautious markets
Already under pressure ahead of the Fed’s news of poor February inflation data and with no sign of the war in Iran easing, markets fell further late in the session.
bitcoin By Wednesday afternoon it had returned to $70,900, down almost 5% in the last 24 hours. Ether (ETH) registered a drop of 6.5%.
The S&P 500 and Nasdaq closed at the day’s lows, down 1.4% and 1.5%, respectively. Gold extended its slide below $4,850 an ounce, now down 3.1% on the day at its weakest price in more than a month.
Stocks related to digital assets remained sharply lower, tracking cryptocurrency prices. Strategy (MSTR), the largest corporate holder of BTC, and Bitmine (BMNR), the leading Ethereum treasury firm, fell between 5% and 6%. Investment firm Galaxy (GLXY) fell nearly 7%, while crypto exchange Gemini (GEMI) fell 15% to roughly its lowest level since going public last year.
