News & Articles

Record within reach

Gold prices have once again approached an all-time high, reaching $3,480 per ounce — the highest level since April 2024. According to TradingView data, there is only one step left to the absolute peak of $3,499 recorded on April 22. Over the past ten days, the precious metal has risen by more than 5%, indicating a strong upward momentum.

What drives the rally: the yield curve as a catalyst

The main driving force behind the growth has been the sharp steepening of the yield curve of U.S. Treasury bonds. The spread between 10-year and 2-year securities has widened to 61 basis points — the highest since January 2022. Even more telling is the increase in the gap between 30-year and 2-year bonds: it has reached 1.30%, a level not seen since November 2021.

This shift is primarily due to a decline in short-term rates: the yield on two-year bonds has decreased by 33 basis points to 3.62%, while the yield on ten-year bonds has only fallen by 14 basis points to 4.23%. In market terms, this is called a "bullish steepening" of the curve: prices for short bonds are rising faster than for long ones, and yields, accordingly, are falling.

Why this matters for gold and Bitcoin

Non-yielding assets — such as gold and Bitcoin — particularly benefit from such conditions. A decrease in short-term rates reduces the opportunity cost of holding "non-profitable" assets, making them more attractive in the eyes of investors.

Ole Hansen, head of commodity strategy at Saxo Bank, explains:

"Now real asset managers have the opportunity to allocate capital to gold again — previously they refrained from doing so due to high financing costs in the context of the Fed's tight monetary policy."

It is worth noting that from 2022 to 2024, gold volumes in ETFs decreased by almost 800 tons — investors were leaving the market amid rising rates. Today, however, the situation is changing dramatically.

Bitcoin as "digital gold": common features and prospects

Although Bitcoin is often associated with the tech sector and correlates with Nasdaq, it is increasingly being viewed as an alternative to gold — a reliable store of value in unstable times. Neither gold nor BTC yield interest or dividends; their value is determined by scarcity, market demand, and trust.

The decline in yields on two-year bonds could also be a bullish signal for cryptocurrency. Especially in conditions where investors are seeking protection from inflation risks and possible interference in monetary policy.

Inflation, fiscal risks, and trust in policy

The stability of long-term rates also plays in favor of safe-haven assets. According to Hansen, about 2.45% of the ten-year yield is attributed to inflation expectations, while the remaining part reflects the real rate, which compensates for fiscal and political risks.

"Investors are increasingly demanding a premium for possible interference in the independence of the Fed and rising government debt. In such an environment, gold acts not only as a hedge against inflation but also as insurance against loss of trust in macroeconomic policy," notes the expert.

ING analysts add:

"A steeper yield curve indicates a market that anticipates: low rates today could lead to accelerating inflation tomorrow. And this is bad news for bonds but good news for safe-haven assets."

Stocks in the shadow: when gold comes to the forefront

Historically, periods of sharp steepening of the yield curve have favored gold and gold mining companies, while stocks, especially cyclical ones, have shown weak dynamics. This is because such conditions often precede economic slowdowns or increased uncertainty.

Bitcoin, with its dual nature — both as a tech asset and as a means of capital preservation — finds itself in a unique position. If the current trend of yield curve steepening continues, the cryptocurrency could benefit from both defensive and speculative market sentiments.

Thus, the rally in gold is not just a local spike. It is a signal of deep shifts in the macroeconomic environment that could support other "non-profitable" but reliable assets — including Bitcoin.