• The Federal Reserve predicted decreased inflation for 2023, causing the price of bitcoin to go up.
• Jerome Powell warned of more rate hikes and that inflation goals would not be hit in 2023.
• Bitcoin experienced its worst year on record in 2022 and has recently gained back some of its losses.
Fed Predicts Decreased Inflation
The Federal Reserve announced that they are predicting decreased inflation for 2023, which caused the price of bitcoin to go up a bit in early February. Federal Reserve chair Jerome Powell gave an interview in which he warned of more rate hikes and that inflation goals would not be hit in 2023.
Bitcoin’s Worst Year On Record
Despite hitting an all-time high at $68,000 per unit, Bitcoin experienced its worst year on record in 2022. This was due to a significant drop from the high $40,000 range over the course of eight weeks. By the end of 2022, Bitcoin was trading at around $16,600 – more than 70% below its all-time high. Other cryptocurrencies followed suit; this caused the crypto industry market cap to fall below $1 trillion when it had been valued at over $3 trillion just 11 months earlier.
Recent Bullish Period
Recently though, Bitcoin has been experiencing something of a bullish period as it has added about $7000 to its price over several weeks – giving hope to investors that 2022 can officially be put behind them.
Rate Hikes To Expand?
Jerome Powell also stated that his agency’s efforts were likely going to expand into 2024 due to their tactics meaning more rate hikes in the coming months – making it harder for individuals to enjoy the American dream by limiting house and car sales throughout the year due to people not being able to pay the interest rates on such items.
Inflation Goals Not Hit In 2023?
Powell also mentioned that he did not see inflation goals being hit in 2023 either despite much work needing done this year – reinforcing his prediction of rate hikes expanding further into next year as well as this one.