Bitcoin Rallies amid Dollar Slump and Fed Concerns
New York — May 20, 2024 —
Fueled by a weakening dollar and concerns over political interference, Bitcoin saw its highest level as April. On Monday morning, the price of bitcoin rose, erasing prior losses. The rally also coincided with a surge in gold prices amid economic uncertainty.For more expert market analysis,read on.
Bitcoin Rallies amid Dollar Slump and Fed Concerns
Table of Contents
New York—Bitcoin surged to its highest level since early April, propelled by a weakening dollar and renewed anxieties surrounding President Trump’s attempts to influence the Federal Reserve. The price of Bitcoin reached levels not seen since Trump’s tariff announcements earlier in the month.
Market Overview
- The largest cryptocurrency by market value increased by approximately 3.9%, reaching over $88,400 on Monday morning in New York.
- This surge effectively erased the losses incurred following Trump’s April 2 reciprocal tariff announcement, which had previously destabilized global markets.
- The dollar and U.S. stocks experienced a downturn on Monday, triggered by the president’s criticism of the Federal Reserve, raising concerns about its autonomy.
did You Know?
Bitcoin’s price volatility frequently enough correlates with major economic announcements and shifts in investor sentiment. Keep an eye on these indicators to better understand market movements.
Expert Analysis
According to Sean McNulty, derivatives trading lead of APAC at digital-asset prime brokerage FalconX, USD weakness is driving the rally in crypto.
McNulty also noted that thin holiday liquidity
in crypto markets is causing the move to be exaggerated.
While U.S. markets are open, Monday is a holiday in many nations, contributing to the thinner liquidity.
Pro Tip
Holiday trading volumes can be unpredictable. Exercise caution and consider adjusting your trading strategies during these periods.
Broader Economic Context
The dollar’s value reached its lowest point since January 2024 after National Economic Council Director Kevin Hassett stated on Friday that Trump is exploring his options regarding the potential removal of Jerome Powell as Federal Reserve Chairman.
Gold’s Parallel Surge
Bitcoin’s recovery coincided with a significant increase in the price of gold, which also reached a new record high. This parallel movement underscores investor demand for assets perceived as safe havens and hedges against inflation.
Reader Question
How do geopolitical events typically impact cryptocurrency values? Share your thoughts in the comments below!
Presidential Commentary
Trump intensified his criticism of Powell on Monday,cautioning that the U.S. economy could decelerate if the Federal Reserve does not promptly lower interest rates.
The Fed’s independence
the independence of the Federal Reserve is a cornerstone of U.S. economic policy. Concerns about political interference can lead to market instability and investor uncertainty.
The Fed’s dual mandate is to promote maximum employment and price stability. Maintaining independence ensures decisions are based on economic data, not political pressure.
An Economic Analyst
