Bitcoin and gold race towards record highs as investors bet on interest rate cuts

Bitcoin and gold raced towards record highs as investors bet on interest rate cuts this summer time.

The digital foreign money reached $67,584 yesterday – its highest degree for greater than two years – sparking predictions that an all-time excessive is ‘around the corner’.

Bitcoin is inside touching distance of its peak of $68,999.99 in November 2021, having risen greater than 50 per cent this yr.

At the identical time, gold rose to $2,120 an oz, its highest degree since December 4 when costs hit an all-time excessive of $2,135 earlier than falling later within the day. 

Brent Donnelly, dealer and president at evaluation agency Spectra Markets, mentioned: ‘We are back to a 2021-style market where everything goes up and everyone is having fun.’

Both gold and bitcoin have been boosted by the prospect of decrease interest charges within the US and past. 

Analysts mentioned any indicators that inflation is falling will proceed to gas hopes of rate cuts – and in flip increase the worth of belongings such as gold.

‘If inflation numbers remain tame, gold’s going to proceed to pattern greater,’ mentioned Jim Wyckoff, senior analyst at Kitco Metals. 

Bitcoin crashed to beneath $16,000 in late 2022 as the cryptocurrency trade was suffering from scandal, which included the collapse of buying and selling platform FTX and subsequent fraud conviction of its founder Sam Bankman-Fried.

But it has bounced again strongly, helped this yr by approval from US regulators for 11 trade traded funds (ETFs) linked to its worth. 

And bitcoin can also be set to get an additional carry subsequent month from one other so-called ‘halving’ occasion when the reward for bitcoin mining is lower in half. 

All of which means that an all-time excessive is ‘around the corner’, says to Lukman Otunuga, senior market analyst at on-line dealer FXTM.