Bitcoin Dips Below $71K as Powell Flags Oil-Driven Inflation Risks

Bitcoin fell below $71,000 Wednesday after Federal Reserve Chair Jerome Powell warned that rising energy prices amid the Iran war are adding to inflationary pressures. BTC traded near $69,494 following the Fed’s announcement.

The Fed held interest rates steady as expected. During his post-meeting press conference, Powell said the recent surge in oil prices is already reflected in the Fed’s outlook. “The oil shock for sure shows up” in inflation projections, though he cautioned that “nobody knows” how persistent the effect will be.

Fed officials raised the 2026 inflation forecast to 2.7% from 2.4%, highlighting concerns that price pressures may remain elevated. Powell dismissed comparisons to 1970s-style stagflation, noting unemployment remains near long-term norms. “We have some tension between our goals, and we’re trying to manage our way through it,” he said.

Markets had already been under pressure from weak February inflation data and ongoing geopolitical tensions. Bitcoin later fell to $70,900, down nearly 5% over 24 hours, while Ether (ETH) declined 6.5%.

U.S. equities closed at session lows: the S&P 500 down 1.4%, the Nasdaq off 1.5%. Gold slipped 3.1% to below $4,850 an ounce, its weakest level in over a month.

Crypto-related stocks mirrored the declines. Strategy (MSTR) and Bitmine (BMNR) fell 5%-6%, Galaxy (GLXY) dropped nearly 7%, and Gemini (GEMI) plunged 15%, approaching its lowest price since going public last year.