Cryptocurrency Market Reacts to Fed’s Expected Rate Cut; Bitcoin Falls from All-Time High – Century Financial

• Cryptocurrency

Bitcoin slipped on Wednesday after a three-day winning streak and a record high, as the digital currency saw profit-taking ahead of a Federal Reserve interest rate decision.

Bitcoin fell 2.4% to $103,688.0, after breaching the $108,000 level a day earlier. 
The largest cryptocurrency reached an all-time high of $108,244 for a brief period on Tuesday. This came after incoming President Donald Trump raised the prospect of a Strategic Bitcoin Reserve, during an interview with CNBC last week. 

The Fed is widely expected to cut interest rates by 25 basis points on Wednesday. But the focus is on the central bank’s long-term outlook on rates, especially in the face of sticky inflation, and a resilient economy.
The central bank may suggest a slower pace of rate cuts in 2025, implying that rates could stay higher for an extended period. This scenario could present challenges for cryptocurrency prices.
Gulf MarketsThe ADX General is advancing slightly to 9,262.73 in Abu Dhabi in early trading.Abu Dhabi Islamic Bank PJSC contributed the most to the index gain, increasing 0.8%. Gulf Pharmaceutical Industries PSC had the largest increase, rising 2.5%.The DFM General Index opened 0.1% lower at 5,072.42 in Dubai.Emirates NBD Bank PJSC contributed the most to the index decline, decreasing 1.0%. Takaful Emarat Insurance PSC had the largest drop, falling 9.9%.
The Tadawul All Share Index opened 0.1% lower, dropping 15.48 to 11,933.24, as stocks lose for the second straight day in Riyadh.
Al Rajhi Bank contributed the most to the index decline, decreasing 0.3%. Al Babtain Power & Telecommunication Co. had the largest drop, falling 2.3%.
Oil steadied after a two-day drop as an industry report signaled a sizable drawdown in US commercial crude inventories.
Brent crude traded above $73 a barrel after shedding 1.8% over the previous two sessions, with West Texas Intermediate near $70. The American Petroleum Institute said US stockpiles shrank by 4.7 million barrels last week, which would be a fourth straight decline if confirmed by official figures later Wednesday.GoldGold prices retreated 0.2% on Tuesday, ahead of the Fed’s final monetary decision for the year. Interest-rate swaps are nearly fully factoring in a quarter-point rate cut in the US, with traders closely watching policymakers’ statements for hints about the 2025 outlook. Lower rates generally benefit gold, as it is a non-interest-bearing asset.

The U.S. economy is considerably resilient as evident from recent economic reports. Although factory activity remains subdued, the services sector is performing strongly. Even consumers are spending at a healthy pace. Retail sales increased by 0.7% in November, surpassing October’s 0.5% rise. A 2.6% surge in sales at auto dealers accounted for most of the growth.

From a technical viewpoint, any upward movement in gold may face resistance near the weekly high of $2,664–$2,666, followed by the $2,677 level. If gold holds strong above this, it could aim for the $2,700 mark and potentially climb further towards the monthly high near $2,726, signalling a continuation of its upward trend. On the downside, the overnight low of $2,633 serves as immediate support, followed by the monthly low near $2,614. A decisive break below $2,600 could encourage bearish traders and increase the likelihood of gold extending its recent pullback from last week’s one-month peak.

Gold prices in the UAE today are as follows:
24 Carat – AED 320.25
22 Carat – AED 296.50
21 Carat – AED 287.00
18 Carat – AED 246.00

• Crude Oil

Oil prices eased about 1% to a one-week low on Tuesday on demand worries following the release of negative economic news from Germany and China, while investors remained cautious ahead of a U.S. Federal Reserve decision on interest rates. In China, the world’s second-biggest economy, industrial output growth quickened slightly in November, while retail sales disappointed, keeping alive calls for Beijing to ramp up consumer-focused stimulus as policymakers brace for more U.S. trade tariffs once President-elect Donald Trump takes office for a second time. meanwhile, U.S. retail sales increased more than expected in November amid an acceleration in motor vehicle and online purchases. The report from the U.S. Commerce Department had no impact on expectations that the Fed would cut interest rates on Wednesday for the third time since the U.S. central bank initiated its policy easing cycle.
Investors, however, will watch U.S. policymakers’ forecasts for signals on whether the Fed will be more cautious in 2025, as economic indicators, such as the retail sales data, point to continued resilience and inflation remains persistent.
In the U.S., oil storage data is due from the American Petroleum Institute trade group later on Tuesday and the U.S. Energy Information Administration on Wednesday.

Last Updated on 5 days by News Desk 1