Bitcoin 72K · Gold rises to an all-time high… UBS: “Further rally as the Fed cuts interest rates”

[Block Media Reporter James Jung] Bitcoin and gold prices are rising together. With the U.S. March inflation index scheduled to be released on Wednesday, there are predictions that gold prices will rise further if the Federal Reserve cuts interest rates.

As the Asian market closed and the European market opened on the 8th, the price of gold rose to $2353.95 per ounce. In the run city market, gold reached a new all-time high.

At the same time, Bitcoin also recovered to $72,000. It rose by more than 4.4% compared to 24 hours ago. The price of the won in the domestic market also exceeded 100 million won again.

Bitcoin has been undergoing a price correction since hitting an all-time high of $73,000 last month. There were concerns that the inflow of funds into Bitcoin spot ETFs may be slowing.

However, as gold prices rallied during the same period, the narrative about digital gold, Bitcoin, began to change.

If it takes time for the Federal Reserve to change its interest rate policy, Bitcoin and gold could become attractive assets for investment as an inflation hedge. The risk of a hard landing may also increase.

In addition, as geopolitical crises such as heightened tensions in the Middle East and Russian terrorism increase, preference for gold and Bitcoin as safe assets and alternative investment assets is increasing.

UBS predicted that gold prices would rise to $2,500 per ounce by the end of this year, reflecting these macroeconomic and geopolitical crises. UBS analyzed that if the Federal Reserve finally cuts interest rates in the middle of this year, it will support another upward trend.

“This gold rally is going against conventional wisdom, especially in light of the high interest rates,” said Ole Hansen, head of product strategy at Saxo Bank. “The narrative is shifting towards continued inflation and a hard economic landing. “Geopolitical uncertainty and deglobalization are also adding to the mix, spurring central bank demand for gold,” he said.

The macroeconomic analysis that explains the rise in gold prices also applies to Bitcoin. The analysis is that Bitcoin and gold are likely to rally together for the time being.