Bitcoin Crumbles Below $78K as US Inflation Beats Expectations

Bitcoin's price dropped below $78,000 on Wednesday after the US Personal Consumption Expenditures (PCE) inflation report showed higher-than-expected price pressures.

The PCE index rose 0.2% in July compared to the previous month, exceeding the forecast of a 0.1% increase. The annual PCE inflation rate was also higher than expected at 3.7%, up from 3.6%.

As a result, traders assessed the implications for US monetary policy and Treasury yields rose after the release of the inflation data. This renewed pressure on risk assets led to Bitcoin's price drop, bringing its recent rally to the test.