Even the deaf sultan heard that Trump wants to lower interest rates, but the FED is ignoring it :)), meaning that demanding a looser monetary policy could have significant effects on both the gold and cryptocurrency markets. Let's evaluate this with the current global economic indicators:
📉 1. General Meaning of Interest Rate Cuts
When interest rates fall, the dollar becomes less profitable → this means a weakening of the dollar.
Investors turn to alternative investment vehicles: like gold, Bitcoin, and other cryptos.
🌍 2. Current Global Economic Conditions
Inflation: Still above targets in many developed countries.
Recession risk: Low growth in the US and Europe, with recession signals in some countries.
Geopolitical tensions (Ukraine-Russia, Middle East): Reducing risk appetite and increasing the search for safe havens.
🪙 3. Impact on Cryptocurrencies
Increase in liquidity → As more money enters the market, interest in cryptos increases.
Especially since Bitcoin is perceived as a kind of “digital gold,” it becomes attractive as a safe haven.
Interest rate cuts increase interest in risky assets → altcoin markets also revive.
However, regulations continue to remain a significant risk factor.
🪙📈 Effects on Bitcoin
Low interest rates and a weak dollar environment → Pulls BTC prices up.
If the FED also cuts interest rates, it's likely that BTC will enter a new bull cycle.
🟡 Impact on Gold
As interest rates fall, bond yields decrease → the opportunity cost of gold decreases.
It begins to attract investors with its safe haven characteristic.
Especially while inflation is still high, demand for gold increases.