- Bitcoin rose 3% in early trading to $71,172, up more than 60% so far in 2024
- The Federal Reserve is expected to reduce its key target rate range by 25 basis points in June
Bitcoin continued its recent strength to hit a new record high near the $72,000 mark on Monday morning, boosted by market hopes of imminent interest rate cuts from the Federal Reserve.
The world’s largest cryptocurrency was trading at $71,700 at mid-morning, up 3.1 percent on the day and more than 60 percent since the beginning of the year.
Bitcoin’s momentum also continues to be driven by flows into the recently launched US spot Bitcoin ETFs, which have seen cumulative flows of over $106 billion since the start of the year.
Fed Rate Cut Hopes Continue to Boost Bitcoin and Gold
Weaker-than-expected U.S. labor market data on Friday raised expectations that the Federal Reserve will cut rates in June.
Market prices currently place a 73.9 percent probability that the Federal Reserve will reduce its current target rate range of 5.25 to 5.5 percent by 25 basis points in June, bringing it to a range of 5 to 5.5 percent. 5.25 percent, according to data from CME Group.
Expectations of global rate cuts have also helped push gold to record levels.
The LBMA gold price in London rose 4.2 percent last week to $2,171.20 late Friday, taking 2024 gains to 18.3 percent.
> The price of gold reaches record levels: What is behind the latest increase and how to invest in it?
Ned Naylor-Leyland, gold and silver investment manager at Jupiter Asset Management, said: “Gold is always forward-looking and has therefore largely absorbed a reduced prospect of rate cuts by the Fed. Federal in 2024 (the bond market has three cuts per year. end).
“Furthermore, there is growing anticipation in the markets regarding the Federal Reserve’s expected transition toward a more accommodative monetary policy stance, which is why we are seeing an uptrend in gold recently.”
