Trump's Crypto Vision Sends Bitcoin to Record $89,000
Key Highlights:
· The US dollar neared a four-month peak against major currencies.
· Bitcoin reaches all-time high as investors focus on Trump's crypto-friendly position.
· The euro and yuan have hit their lowest levels.
On Tuesday, the US dollar approached a four-month high against key currencies, while Bitcoin extended its record-breaking rally as investors flocked to assets expected to thrive under the incoming Donald Trump administration.
Bitcoin, the leading crypto-currency, surged to a new all-time high of $89,637 (Rs 7.44 lakh) on Tuesday. President Donald Trump has promised to transform the United States into "the crypto capital of the planet."
The euro stayed close to a nearly seven-month low reached the night before, while the Yuan hovered near a more than three-month low, as both Europe and China faced the threat of potential tariffs from Trump.
The US dollar index, which measures the dollar against six major currencies including the euro, rose by 0.07% to 105.49 at 0037 GMT, after reaching 105.70 on Monday, its highest level since July 3.
Trump has cautioned the European Union that it will "pay a big price" for not purchasing enough American goods, specifically targeting car imports. He has also threatened China with sweeping 60% tariffs. Following his January inauguration, Trump’s Republican Party is set to control both chambers of Congress, according to a projection from Decision Desk HQ on Monday. This will allow him to advance his plans to reduce taxes and scale back the federal government.
Market expectations for a 0.25 percentage point interest rate cut by the Federal Reserve on December 18 have dropped to approximately 65%, down from nearly 80% last week, due to concerns over potentially inflationary tariffs and immigration policies, according to CME Group's FedWatch Tool.
"If history is any guide, Bitcoin could easily finish the year around $100,000," said Kyle Rodda, a senior financial markets analyst at Capital.com. Meanwhile, "the expectation of US economic outperformance and aggressive trade practices from the Trump administration continues to push the US dollar higher," Rodda said.
The offshore yuan dropped to 7.2337 per dollar on Monday, marking its lowest level since August 2, before recovering slightly to 7.2241.
At the same time, the euro fell to $1.0629 overnight, hitting its lowest point since April 22, and was last traded at $1.0658.
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