Bitcoin Bulls Set Eyes Above $30,000 As Gold Taps New All-Time High
May 27, 2023- Spot gold rose 0.9% to a new record high of $2,080.72 an ounce on Wednesday following an interest rate hike by the Federal Reserve.
- Market commentators criticize the continuous decision of the Feds to hike interest rates predicting a future stall in hikes.
Bitcoin (BTC) now trades above $26,000 after the Feds vote to raise the interest rate to the highest point in 16 years but signals a pause for future hikes.
BTC trades hands at $26,737 at the time of writing after falling on May 2. The slight rally comes after the Federal Reserve hikes interest rates by another 25 points amid significant economic turmoil in the banking sector.
At the start of the week, BTC price crawled in anticipation of the rate hike but witnessed the market leader reclaiming $26k, a much-needed boost as bulls locked their eyes on the $30,000 resistance level.
Gold prices hit new highs following the hike by the Feds, benefiting from the bank’s decision to implement stringing measures for future hikes. An ounce of gold now trades at $2,080 as investors seek a safe haven in the precious metal.
The Federal Reserves leaning toward a pause in rate hikes after a streak of 10 previous hikes also fueled a surge in the digital asset market. The Feds will now adopt a more “data-driven and meeting-by-meeting approach” for future decisions.
Financial analysts at ING believe that a pause is here to stay, given worsening economic situations and ‘bank stresses.’
“With lending conditions rapidly tightening in the wake of recent bank stresses, we think this will mark the peak for interest rates with recessionary forces set to prompt interest rate cuts later this year.”
Experts mount pressure on Feds
Financial executives have criticized the approach of the Federal Reserve in handling inflation, pointing to the collapse of regional banks as more continue to struggle amid higher interest rates for consumers. Michael van de Poppe, Eight’s CEO, lashed out at the Federal Reserve.
“The biggest joke is the fact that Jerome Powell says that the banking system has improved and is healthy, sound, and resilient. It’s the weakest it has ever been, and another few banks have been falling apart after the market. This was the last hike,” he added.
Former CEO of BitMEX Arthur Hayes says the decisions of the Feds are now based on politics rather than rational decisions.
“You never know what is the trigger that causes Yellen or Powell to cave and bail everyone out. It’s all politics now, and politics is more about power than rational decisions,” he tweeted.
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