U.S. Shutdown Uncertainty Drives Gold, Bitcoin to Record Highs
The U.S. government has entered its first shutdown in nearly seven years, casting uncertainty over the country's macroeconomic outlook. Meanwhile, gold and Bitcoin have reached record highs, with the crypto market buzzing with bullish sentiment.
The shutdown, which began due to a political stalemate, has left the duration of its impact uncertain. During the 2018 shutdown, the S&P 500 index shed more than 9%, marking the worst December on record since 1931. This time, however, the impact on stocks remains to be seen.
Gold, often seen as a safe haven asset, has responded to the uncertainty by hitting a new all-time high above $3,922 per ounce. Meanwhile, Bitcoin, the world's largest cryptocurrency, has also surged to new heights, recently surpassing $117,000, its highest price in about two weeks.
Crypto market sentiment is currently bullish, with a 65% chance of Bitcoin breaking another all-time price record and potentially surging to $125,000. Some analysts, like Eric Balchunas, a senior ETF analyst at Bloomberg, suggest that Bitcoin may be decoupling from the stock market, as indicated by recent trends. Additionally, a rate cut from the Federal Reserve is expected, which could further contribute to Bitcoin's recent spike.
As the U.S. government shutdown continues, its impact on the macroeconomic outlook remains uncertain. Gold and Bitcoin, however, have reached record highs, reflecting investor sentiment amidst the uncertainty. While Bitcoin's recent surge is promising, its future trajectory depends on various factors, including the duration and impact of the shutdown.
