Bitcoin has recently experienced a significant downturn, falling below the $89,000 mark. This decline has resulted in a loss of over $100 billion from the cryptocurrency market. Recent data from CoinGecko indicates that the total market capitalization dropped from approximately $3.2 trillion to $3.1 trillion as Bitcoin traded around $89,400, reflecting a 3% decrease for the day.
The drop in Bitcoin's value coincided with the publication of the latest US Personal Consumption Expenditures, or PCE, inflation report. The findings align closely with analysts' expectations, suggesting that inflationary pressures in the economy are stabilizing rather than escalating. The headline PCE has risen by 2.8% on a year-over-year basis, a slight increase from the previous month's figure of 2.7%. Additionally, the monthly PCE figure remained consistent at 0.3%.
Focusing on the core PCE, which is the preferred inflation metric of the Federal Reserve, an increase of 2.8% year over year was reported, just shy of forecasts. Month-over-month, core PCE held at 0.2%, indicating that while inflation is persistent, it remains contained. These insights could impact market sentiment and investor strategies, particularly in the cryptocurrency sphere, which often reacts sharply to shifts in economic indicators.