On May 6, 2025, gold prices rose to $3,434/ounce (according to #FXCE ) and Bitcoin held steady around $97,500 on Tuesday, as investors prepared for the U.S. Federal Reserve's policy decision amid geopolitical and trade tensions. Is this a signal for a surge in safe-haven assets? Let's analyze in detail.
Gold and Bitcoin Rise Ahead of Fed Decision
Spot gold rose 0.7% to $3,434/ounce, U.S. gold futures increased by 1.3%, supported by safe-haven demand from Chinese investors and central banks reducing reliance on the USD. Bitcoin fluctuated around $97,500, near the February peak, up 10% from recent lows, though still below the historic high of $108,786 (January). The two-day meeting of the Federal Open Market Committee (#FOMC ) is expected to keep interest rates steady at 4.25%-4.50% on Wednesday afternoon (U.S. time), with a speech from Chairman Jerome Powell afterward. The market is particularly attentive to signals regarding persistent inflation and declining consumer demand.
Geopolitical and Trade Tensions
The situation in the Middle East escalated as Houthi forces in Yemen fired ballistic missiles near Ben Gurion Airport, Tel Aviv, on Saturday, injuring 8 people and disrupting air traffic. Israel responded with a series of airstrikes on Houthi infrastructure in Yemen, including Sanaa International Airport, a cement plant, and power facilities, resulting in 3 deaths and dozens of injuries. The Houthi threatened retaliation, increasing demand for safe assets. Meanwhile, President Donald Trump proposed new tariffs on foreign pharmaceuticals and media, raising concerns about retaliatory responses and global trade disruptions. However, news of U.S.-China trade negotiations boosted Asian stocks and strengthened the USD on Wednesday morning.
Impact on the Crypto Market
This event brings many signals:
Increased safe-haven demand: Gold and Bitcoin benefit from instability, similar to how Bitcoin ETFs attracted $1.8 billion last week.
Volatility from the Fed: If Powell signals a rate cut in June, Bitcoin could reach $100,000 – a liquidity attraction level, according to Nic Puckrin (The Coin Bureau). Conversely, persistent inflation could curb the rally.
Long-term support: Crypto fund inflows reached $3.4 billion last week, with a forecast to accumulate $330 billion in Bitcoin by 2029 (Bernstein) reinforcing the trend.
Future Prospects
With Bitcoin prices rising 10% recently and gold increasing due to Chinese investors, both assets have breakout potential if the Fed cuts interest rates. However, geopolitical tensions and Trump's trade policies may create volatility in the next 1-2 months, requiring investors to stay vigilant.
Conclusion: Will Bitcoin and Gold Surge After the Fed?
Gold rose 0.7% to $3,357 and Bitcoin held steady at $97,500 ahead of the Fed decision, amid Middle East tensions and Trump tariffs. If Powell signals a rate cut, Bitcoin could hit $100,000, while gold continues to attract. Investors should closely monitor to seize opportunities in this volatile market.
Risk warning: Crypto investment carries high risks due to price volatility and legal uncertainties. Please consider carefully before participating.