Gold Prices Soar
Gold Hits New All-Time High as Bitcoin Rallies to September High Above $64K – Gold prices have reached their highest-ever level following a recent interest rate cut by the United States Federal Reserve.
On September 23, the price of gold hit a record high of $2,629 per ounce. This surge follows a gain of more than 5% over the past two weeks.
Bitcoin’s Rise
Bitcoin, often referred to as digital gold, is also experiencing significant gains. Following the Fed’s rate decision, Bitcoin climbed 8.5% in price. On September 23, the asset reached an intraday high of $64,660, marking its highest point in four weeks, according to CoinGecko.
Gold Hits New All-Time High as Bitcoin Rallies to September High Above $64K – Impact of the Fed Rate Cut
The surge in both gold and Bitcoin prices comes after the Fed announced a 0.5% interest rate cut on September 18. Lower interest rates make traditional investments like short-term government bonds less attractive. As a result, assets like gold become popular choices for diversification and inflation hedging.
Geopolitical Risks Drive Demand
Ongoing global geopolitical risks are also boosting the demand for gold. Conflicts such as the wars in Russia and Ukraine, as well as the situation between Israel and Hamas, are contributing to this appetite for gold investments. Additionally, the upcoming U.S. presidential election in November adds another layer of uncertainty.
Increased Central Bank Purchases
The volume of global central bank purchases of gold has tripled since Russia’s invasion of Ukraine in early 2022. A Goldman Sachs report from September 12 indicates this trend.
Researchers at the investment bank predict that gold prices could reach $2,700 by early 2025, supported by further rate cuts from the Fed.
Gold Hits New All-Time High – Inflation-Adjusted Prices
Despite the recent rally, Peter Boockvar, the chief investment officer at Bleakley Financial Group, notes that gold has not yet surpassed its inflation-adjusted price. Gold peaked at $3,200 in 1980 when adjusted for inflation. This suggests that while gold is hitting new highs, it still has room for growth relative to historical values.
Gold Hits New All-Time High as Bitcoin Rallies to September High Above $64K – Summary
In summary, gold’s new all-time high and Bitcoin’s recent surge highlight a significant moment in the market. Investors are reacting to the Fed’s decisions and global uncertainties. With continued geopolitical tensions and changes in monetary policy, both gold and Bitcoin may see further price movements in the near future.
