Despite the economic recession, July turned out to be an influential month for the stock market. However, the Dow Jones industrial average dropped pointedly when the Fed monetary policy cut rates. In inverse proportion to the decline in figures, Bitcoin hiked above the local lows and might signal an optimist reversal.
The Federal Open Market Committee decreased the lending rates by 25 basis points, leaving the market investors fretted. In response, the investors began selling off the stocks resulting in drop for the dow by 450 points.
Jerome Powell, Federal Reserve chairman, called the cut a ‘mid-cycle adjustment to the policy’ and stated that it is not a beginning of a long series of rate cuts. Notwithstanding it, the investors were shaken accompanying sharp decline.
Bitcoin as digital gold
With accelerated economic doddering comes disorder at the prices of gold and safe-haven currencies. Gold’s evergreen valuation makes it a leading choice to invest during financial turmoils. Bitcoin and gold have been showing related price shifts. The digital currency experienced its first federal rate cut since it existed with the decade’s first-rate cut.
Bitcoin may now prove its potential as gold in the digital world, and it is all guesses how Bitcoin reacts further in this phase.