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European stocks fell 1.2% following a hawkish shift from the Federal Reserve, which reduced its forecast for interest rate cuts in 2025. The yen weakened past 156 against the dollar as the Bank of Japan maintained its borrowing costs, while US stock futures indicated a potential recovery amid a resilient economy. European government bonds also saw significant losses, with UK 10-year yields reaching their highest since October 2023 ahead of the Bank of England's policy decision.
Year-to-date, commodities have performed notably, with cocoa prices soaring 180% and precious metals like gold and silver rising over 20%, driven by geopolitical uncertainties and central bank diversification away from the US dollar. Silver prices have shown an upward trend since March, facing critical support at $30, while gold struggles with resistance at $2720. A break below key support levels could signal deeper pullbacks, whereas holding above these levels may reinforce bullish trends.
IG
AUD/USD has fallen to a new 13-month low, currently trading at $0.63, with potential support at the October low of $0.6271. Meanwhile, EUR/USD remains range-bound, and GBP/USD is struggling to gain momentum, hovering near recent lows while facing resistance around $1.2715 to $1.275. Upcoming monetary policy decisions from the Fed and BoE are anticipated to influence market movements.
IG
Tether (USDT) inflows to exchanges have surged, averaging $40 million daily over the past eight weeks, fueling a bullish crypto market as Bitcoin reaches record highs. USDT now dominates 66% of the $212 billion stablecoin market, reflecting its growing utility beyond trading, with potential expansion into cross-border payments and remittances. Regulatory clarity is anticipated to further unlock stablecoins' potential, particularly in emerging markets.
UBS forecasts gold prices will reach $2,900 per ounce by the end of 2025, driven by rising central bank and investor demand, lower interest rates, and a weaker U.S. dollar. Despite a recent decline, gold remains 28% higher year-to-date, with expectations of continued strong buying momentum amid geopolitical uncertainties. The firm anticipates central banks will purchase over 900 metric tons of gold in 2025, supporting a bullish outlook for the metal.
U.S. stocks experienced volatility on Wednesday following the Federal Reserve's announcement of a quarter-point rate cut, which was anticipated. The Fed's updated projections indicated higher inflation and fewer rate cuts expected in 2025, leading to a downturn in the markets.
The Federal Reserve has cut its benchmark interest rate by 25 basis points to a target range of 4.25%-4.5%, reflecting mixed economic signals. This decision comes as the crypto market faces declines, with Bitcoin down 4% and Ethereum and Solana experiencing larger losses.Economic projections indicate a GDP growth of 2.5% for 2024, with a slight rise in the unemployment rate to 4.3% by 2025. Analysts are cautious about future rate cuts, anticipating only two reductions in 2025, while uncertainty surrounding President-elect Donald Trump's policies adds to market volatility.
Litecoin's price surged 30% in a month, reaching $129.50, fueled by miners accumulating $18 million worth of LTC. This aggressive accumulation has tightened supply and bolstered bullish sentiment, positioning Litecoin for a potential breakout above $135, with analysts eyeing a run toward $150. However, risks remain, as failure to maintain levels above $126 could lead to a retracement.
Bitcoin hovered around $104,710 as traders anticipated a Federal Reserve interest rate decision, with expectations leaning towards a 0.25% cut. Despite a dip-buying sentiment, pre-FOMC selling pressure was evident, and some analysts noted a potential gap in Bitcoin futures at $102,000 that could be filled during the announcement. Concerns about future rate hikes in 2025 due to rising inflation were also highlighted.
Crypto analyst Michaël van de Poppe predicts Bitcoin could soar to $500,000 in the current cycle, following its recent all-time high above $108,000. He notes that many altcoins are still in the accumulation phase, indicating potential for significant breakouts. Despite a recent pullback, analysts view this as a healthy correction, with strong inflows into Bitcoin ETFs suggesting sustained investor interest.
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