From Fortune · Camila Grigera Naón · · 1m 40s
Bitcoin and gold fall as inflation drives investors to bonds
Rising prices push investors away from non-yielding assets like Bitcoin and gold toward government bonds offering income.
In brief
Rising prices push investors away from non-yielding assets like Bitcoin and gold toward government bonds offering income. Bitcoin fell over four percent to sixty-eight thousand five hundred dollars as inflation concerns and rising interest rate expectations drive investors toward income-yielding bonds. Originally…
Bitcoin tumbles on weak demand
Bitcoin fell more than four percent on Friday to sixty-eight thousand five hundred dollars, wiping out gains built over the past three months. CryptoQuant's demand indicator recorded its weakest reading since December twenty twenty-three.
Crypto markets shrink as cash dries up
Tether's USDT, the largest cryptocurrency pegged to the U.S. dollar, lost seven point seven billion dollars in total value over the past two months, signalling less cash available in crypto markets overall.
Inflation hotter than expected
Tuesday's Consumer Price Index report showed prices rose zero point four percent in October, more than economists expected. Even stripping out food and energy, inflation ran hotter than forecast.
Investors dump non-yielding assets
Traders expect the Federal Reserve to raise interest rates by a quarter percentage point in December.Chris Beauchamp, chief market analyst at IG Group, said people are abandoning gold and Bitcoin for government bonds providing income.
“people are chucking stuff like gold and Bitcoin to find… government bonds that are going up, providing you [with] income”
Gold also retreats sharply
Gold traded near three thousand nine hundred dollars an ounce on Friday, well below its January peak of about five thousand six hundred. Prices have fallen roughly five percent over the past month.
AI boom and rates complicate outlook
Bitcoin faces competition from the AI sector, which draws investment dollars while keeping the economy strong enough for rates to stay high.
Here's the gist
Bitcoin fell over four percent to sixty-eight thousand five hundred dollars as inflation concerns and rising interest rate expectations drive investors toward income-yielding bonds.
