Gold prices reached a new high, and Bitcoin’s value is on the rise too. This happened because investors are changing their plans, thinking interest rates might go down. For almost two years, higher interest rates made people want more US dollars and certain debts.
But now, investors think rates might get cut, so they’re interested in other things like gold and Bitcoin. On Monday, gold went over $2,000, but then it went down a bit. People also wanted more dollars later in the day, so gold prices dropped more. Some investors sold their gold because it was at a high price.
This increase in prices started a few weeks ago, especially when there was tension in Israel and Gaza. The recent jump happened because the head of the US central bank, Jerome Powell, said on Friday that they might not raise rates anymore for now.
Last year, the Federal Reserve and other banks quickly raised rates because they were worried about prices going up too fast. This made people change how they invest their money. But now, Powell says rates are high enough, and they might not raise them more.
Some traders think they might even cut rates in March 2024, but Powell is trying to calm those thoughts down. If interest rates stay low, gold prices might keep going up, according to a metals trader.
Meanwhile, Bitcoin’s price is going up too. It dropped a lot in 2022 because of higher rates and some problems. Now, it’s going past $42,000, the highest since April 2022. Bitcoin’s price has doubled since the start of this year.
Bitcoin hopes people will forget about past troubles, like US regulators taking action against big crypto trading firms. The regulators might approve new ways to trade Bitcoin next month.
As a content creator, this news shows how changes in interest rates can affect the prices of gold and Bitcoin. Investors are adjusting their plans based on what they think will happen with rates. It’s like a financial puzzle, and each piece affects the others. This information was originally reported by BBC.
https://www.bbc.com/news/business-67617540