Bitcoin price today: dips to $68k amid Iran conflict; still set for weekly jump

Bitcoin retreated on Friday, falling below the key $70,000 level as escalating conflict in the Middle East drove oil prices higher and clouded the outlook for global inflation and interest rates.

The world’s largest cryptocurrency was last down 5.2% at $68,779.0 by 09:40 ET (14:40 GMT), after briefly jumping above $74,000 earlier this week, leaving it still on track for a weekly gain of more than 4%. 

Iran conflict, oil price surge in focus

Crypto sentiment remained fragile as geopolitical tensions intensified after U.S. and Israeli strikes on Iran triggered retaliatory missile and drone attacks across the region, with war entering its seventh day.

The war has also threatened shipping through the Strait of Hormuz, a key global energy chokepoint that normally handles roughly 20% of the world’s oil supply, sending shockwaves through commodity markets.

Oil prices have surged since the escalation began, jumping more than 16% so far this week amid fears of prolonged supply disruptions if the conflict continues.

Higher crude prices have fueled concerns about a renewed wave of global inflation, complicating the outlook for monetary policy. Investors have begun trimming expectations for imminent interest-rate cuts from the U.S. Federal Reserve as energy-driven price pressures could keep inflation elevated.

The shift in rate expectations helped the U.S. dollar gain ground this week, putting pressure on several risk assets. A stronger greenback also weighed on commodities, with gold on track for a weekly decline despite ongoing geopolitical tensions.

US payrolls fall in February, boosting hopes for Fed rate cuts

The U.S. labor market weakened in February as nonfarm payrolls unexpectedly declined, a drop partly linked to severe winter weather and a strike at a major health care provider.

Data released Friday by the Bureau of Labor Statistics showed payrolls fell by 92,000 during the month, missing expectations for a gain of 50,000 and coming in below January’s revised increase of 126,000. February marked the third decline in payrolls over the past five months, following a revised drop of 17,000 recorded in December.

The unemployment rate also edged higher, rising to 4.4% as job losses spread across several key sectors.

The weaker labor market reading came despite broader signs of resilience in the economy. Recent data showed continued expansion in both the services and manufacturing sectors, while consumer spending has remained relatively steady. However, there are increasing indications that much of that spending is being driven by higher-income households.

Following the jobs report, markets adjusted expectations for the Fed’s next move. Traders now anticipate the next rate cut could arrive as early as July and are pricing in a higher probability of two reductions before year-end, according to CME Group’s FedWatch tool.

Earlier in the day, Fed Governor Christopher Waller said that a weaker-than-expected employment report could influence the policy outlook. Waller has been among the few members of the Federal Open Market Committee advocating for rate cuts in the near term.