The U.S. Federal Reserve will hold a meeting this Tuesday and announce its interest rate decision in the early morning of 9/19 Taiwan time. Last week, all three major U.S. stock indexes closed higher on expectations of interest rate cuts. The S&P 500 rose 4% for the week, and the Nasdaq index surged 5.9%, both recording their best weekly gains this year. Gold reached a new high last week, but can Bitcoin, known as digital gold, keep up with gold and catch up with this wave of capital market?
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ToggleThe Federal Reserve meets this week
The Federal Reserve will hold a meeting from the 17th to the 18th and announce its interest rate decision in the early morning of 9/19 Taiwan time. The market has mixed views on whether to cut interest rates by one or two cents. Wall Street Journal reporter Nick Timiraos, known as the "Fed's mouthpiece", revealed that recent data have provided mixed signals for the U.S. economy, and policymakers are evaluating one or two rate cuts. According to the CME FedWatch Index, investors are seeing a difference between number one and number two, believing that the chance of a rate cut of number two is currently 52%.
BTC once exceeded 60,000 magnesium, and ETH/BTC fell below 0.04
Bitcoin once reached $60,625 over the weekend, rising 7.4% in the past seven days. Bitcoin spot ETFs saw net inflows of up to US$263 million on 9/13, mainly driven by Fidelity's FBTC (net inflow of US$102 million) and Ark's ARKB (net inflow of US$99.3 million).
However, the trend of Ethereum is relatively weak, with the ETH/BTC exchange rate falling below 0.04, hitting a new low since April 20, 2021, and was reported at 0.03919 at the time of writing. This exchange rate reached a historical high of 0.1238 in January 2018, and the low was 0.01615 in September 2019.
The interest rate cut train is about to start, gold hits new highs, can Bitcoin keep up?
At present, it seems that the start of this wave of interest rate cuts is just around the corner, but what assets will benefit?
Gold has once again hit a record high, helped by interest rate cuts and a weaker U.S. dollar. With the influx of funds, holdings of the world's largest gold-listed exchange-traded fund SPDR have reached their highest level since early January. Analysts at Commerzbank said:
The market still expects the Federal Reserve to cut interest rates by 100 basis points before the end of the year, and gold prices may continue to rise due to aggressive interest rate cut expectations in the coming months.
And can Bitcoin, known as digital gold, keep up with gold and hit a new all-time high? According to previous reports, analysts believe that the outcome of the US presidential election will greatly affect the trend of Bitcoin. Standard Chartered expects that if Trump wins, the price will reach US$125,000; if Harris is elected, the price may reach US$75,000. Bernstein believes that if Trump wins the election, BTC will reach US$90,000 by the end of the year, but if Harris wins, it will drop to US$30,000.
