On Friday, the price of gold reached $3,390 per ounce, its highest level in two weeks, supported by intensifying trade tensions and growing expectations of an interest rate cut in the United States. New customs tariffs promoted by President Donald Trump have been applied, ranging from 10% to 50% and targeting numerous countries.
A 100% tariff on imported semiconductors has also been announced. Despite some exemptions for companies willing to manufacture in the US, these measures have contributed to increased uncertainty in the markets. At the same time, Minneapolis Federal Reserve President Neel Kashkari indicated that interest rate cuts may be necessary in the context of a slowdown in the US economy.
Data on both initial and continuing unemployment claims exceeded expectations, with the latter reaching a three-year high. According to CME FedWatch, the probability of a 25 basis point rate cut by the Federal Reserve in September is now estimated at between 91% and 93%.
An interest rate cut by the US Federal Reserve (Fed) can affect the value of the dollar and, consequently, other asset classes such as Bitcoin. When the Fed cuts interest rates, the cost of money goes down and holding dollars becomes less advantageous, which can lead to a weakening of the US currency as investors seek alternative returns.
A weaker dollar can increase interest in Bitcoin, which is often seen as an alternative store of value and a portfolio diversification tool. In addition, rate cuts can stimulate economic activity, increasing liquidity and risk appetite, which can affect demand for assets such as Bitcoin.
One significant factor that could favor Bitcoin and gold is a recent decision by the United States. The US Congress has passed a law explicitly prohibiting the creation of a national digital currency (digital dollar).
This decision comes at a time when the US appears intent on establishing a clearer regulatory framework for the cryptocurrency sector. The recently approved legislative package introduces measures such as the definition of roles between the CFTC and SEC, more specific rules for stablecoins, and incentives for innovation in the digital payments sector. The result appears to be a contrast of intentions, characterized by the simultaneous introduction of restrictions and openings.
At the political level, the anti-CBDC (central bank digital currency) law has been promoted by figures who express marked distrust of the Federal Reserve and the federal government. These fears, fueled by comparisons with China’s financial surveillance system and the e-yuan, are based on the assumption that an American CBDC could lead to excessive control over citizens’ spending habits.
However, these concerns do not take into account the privacy protection mechanisms that, for example, the European Central Bank is implementing in the digital euro project.
There are legitimate concerns. Central bank digital currencies (CBDCs), by offering a direct alternative to bank deposits, could exacerbate the risk of bank runs in times of crisis. However, recent cases — such as the collapse of Silicon Valley Bank in 2023 — show that financial panic is already capable of spreading digitally. Europe’s response, which includes limits and intermediaries for the issuance of digital currency, shows that solutions exist.
The real problem for the US, however, may be another: the isolation of the dollar from the increasingly active circuit of international interbank CBDCs. The mBridge project, developed by countries such as China, Saudi Arabia, and the United Arab Emirates, aims precisely to create an international payment system that excludes the dollar and circumvents the risk of US sanctions.
Forecasts indicate the possibility that bitcoin could reach new records at 125,000 and gold could rise to 3,500, trends supported by the future weakening of the dollar.
