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Gold hits record high and bitcoin exceeds $40,000 – business live | Business

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Introduction: Gold at record high on rate cut hopes

Hello and welcome to our ongoing coverage of business, financial markets and the global economy.

Gold hit a record high for the second straight session, as investors flock to the traditional safe-haven asset in hopes of interest rate cuts in the coming months.

The price of gold reached $2,111.39 per ounce, surpassing the record set Friday evening and even higher than the previous record set in August 2020.

Gold strengthened on hopes that the interest rate hike cycle of the past two years is now over and central banks will focus on reducing borrowing costs in 2024.

This has led to a weaker US dollar, which pushes up the price of gold (as it is valued in dollars).

As this chart shows, gold has been climbing fairly steadily since early October, when it changed hands at $1,820 an ounce.

The price of gold over the past five years
The price of gold over the last five years Photography: Réfinitiv

Crypto assets are also paying off, with bitcoin hitting $40,000 for the first time this year today as some traders bet the US Federal Reserve could begin cutting US interest rates next spring.

Kyle Rodda, senior financial markets analyst at Capital.com, explain :

Markets expect the Fed to cut rates next year, perhaps as early as March. This pushed both gold and Bitcoin to critical levels, with the former hitting record highs and the latter reaching $40,000 for the first time since May 2022.

Gold’s move had all the hallmarks of a technical meltdown, with the breakout of previous all-time highs triggering stop and buy orders.

A lower interest rate environment would favor gold, which does not generate returns (unlike bonds, stocks or current savings accounts).

Also coming today

Britain’s economy will be under the microscope, as think tank the Resolution Foundation holds a full-day event examining a better economic strategy for the country.

They will hear from Labor leader Sir Keir Starmer, who is expected to warn he will not turn on the spending taps if he wins the next election.

The Guardian reports this morning that Starmer will say:

“Anyone expecting a new Labor government to quickly turn on the spending taps will be disappointed… It is already clear that the decisions made by the government, not to mention its record over the past 13 years, will limit the possibilities of a future Labor government. can do.”

“This parliament is set to become the first in modern history where the standard of living in this country has actually contracted. Household income growth is down 3.1% and Britain is worse off.

“It is not a question of too slow an increase in living standards nor of an unequal concentration of wealth and opportunity. It is Great Britain which is going backwards. It’s worse than the 1970s, worse than the recessions of the 1980s and 1990s, and even worse than the great crash of 2008.”

Agenda

  • 7:00 GMT: German trade balance statistics for October

  • 9:30 GMT: The Resolution Foundation holds an event examining the UK economy in 2030

  • 2:00 p.m. GMT: ECB President Christine Lagarde delivers a speech at the Academy of Moral and Political Sciences conference in Paris

  • 15:00 GMT: US factory orders for October

Key events

Investors don’t seem to be listening to warnings from central bankers that it’s too early to cut interest rates. Or they don’t believe them.

In addition to the weakening of the US dollar, we have seen a rise in bond prices over the past six weeks, which has pushed bond yields lower.

The market is pricing in earlier and more aggressive cuts from central banks and inflation appears to be on a lower trajectory, according to Mohit Kumarchief economist Europe at investment bank Jefferies.

And this, despite the efforts made on both sides of the Atlantic to oppose this discourse.

Last Friday, Federal Reserve Chairman Jerome Powell insisted that it would be “premature to conclude with confidence” that interest rates have now peaked, or to speculate on when they might be reduced.

Some analysts are predicting that gold could continue to rise, adding to the record high of $2,111 an ounce set this morning.

UOB Responsible for market strategy, global economy and market research, Heng Kun Howtold CNBC:

“The expected decline in the dollar and interest rates throughout 2024 is a key positive for gold.”

He estimates that the price of gold could reach $2,200 by the end of 2024.

Everett Millmanchief market analyst at Gainesville Coinsalso sees more short-term gains, stating:

“Gold hosted a Santa rally and I expect that to continue until the end of this year.

Full Story: Bitcoin over $40,000

Although bitcoin has yet to reach an all-time high, today’s rise takes it to its highest level since April 2022.

Bitcoin surpassed $40,000 for the first time this year as it – like gold – rides a wave of enthusiasm over interest rate cuts in the United States.

The world’s largest cryptocurrency is currently trading at $41,455, up nearly 7% since Friday evening, as the crypto market continues to emerge from the downturn that began last summer.

Reuters said:

A 50% rise since mid-October “appears to mark a decisive shift from the downward trend of 2022 and early 2023,” said Justin d’Anethan, head of business development for Asia-Pacific at Keyrock, a digital asset marketplace creation company. .

He said evidence of institutional buying through November showed renewed interest and while future reversals are not inconceivable, lows hit around $16,000 a year ago “probably hit the bottom.”

Some traders also expect the imminent approval of exchange-traded Bitcoin funds in the United States, Reuters adds:

A spot Bitcoin ETF could allow previously wary investors to access crypto through the stock market, paving the way for a new wave of capital into the sector.

Introduction: Gold at record high on rate cut hopes

Hello and welcome to our ongoing coverage of business, financial markets and the global economy.

Gold hit a record high for the second straight session, as investors flock to the traditional safe-haven asset in hopes of interest rate cuts in the coming months.

The price of gold reached $2,111.39 per ounce, surpassing the record set Friday evening and even higher than the previous record set in August 2020.

Gold strengthened on hopes that the interest rate hike cycle of the past two years is now over and central banks will focus on reducing borrowing costs in 2024.

This has led to a weaker US dollar, which pushes up the price of gold (as it is valued in dollars).

As this chart shows, gold has been climbing fairly steadily since early October, when it changed hands at $1,820 an ounce.

The price of gold over the last five years
The price of gold over the last five years Photography: Réfinitiv

Crypto assets are also paying off, with bitcoin hitting $40,000 for the first time this year today as some traders bet the US Federal Reserve could begin cutting US interest rates next spring.

Kyle Rodda, senior financial markets analyst at Capital.com, explain :

Markets expect the Fed to cut rates next year, perhaps as early as March. This pushed both gold and Bitcoin to critical levels, with the former hitting record highs and the latter hitting $40,000 for the first time since May 2022.

Gold’s move had all the hallmarks of a technical meltdown, with the breakout of previous all-time highs triggering stop and buy orders.

A lower interest rate environment would favor gold, which does not generate returns (unlike bonds, stocks or current savings accounts).

Also coming today

Britain’s economy will be under the microscope, as think tank the Resolution Foundation holds an all-day event to examine a better economic strategy for the country.

They will hear from Labor leader Sir Keir Starmer, who is expected to warn he will not turn on the spending taps if he wins the next election.

The Guardian reports this morning that Starmer will say:

“Anyone expecting a new Labor government to quickly turn on the spending taps will be disappointed… It is already clear that the decisions made by the government, not to mention its record over the past 13 years, will limit the possibilities of a future Labor government. can do.”

“This parliament is set to become the first in modern history where the standard of living in this country has actually contracted. Household income growth is down 3.1% and Britain is worse off.

“It is not a question of too slow an increase in living standards nor of an unequal concentration of wealth and opportunity. It is Great Britain which is going backwards. It’s worse than the 1970s, worse than the recessions of the 1980s and 1990s, and even worse than the great crash of 2008.”

Agenda

  • 7:00 GMT: German trade balance statistics for October

  • 9:30 GMT: The Resolution Foundation holds an event examining the UK economy in 2030

  • 2:00 p.m. GMT: ECB President Christine Lagarde delivers a speech at the Academy of Moral and Political Sciences conference in Paris

  • 15:00 GMT: US factory orders for October



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