Global Uncertainty Sparks Surge in Safe-Haven Assets
In the face of growing economic and geopolitical instability, investors are flocking too safe-haven assets like bitcoin, gold, and the Swiss franc.
Even though bitcoin’s price has seen some setbacks, it’s still substantially above its year-to-date low. Impressively, Bitcoin ETFs have added $54 billion in assets since January last year.
- The U.S. dollar index has weakened by more than 10% from its peak this year.
- Rising inflation and slower job growth indicate U.S. economic challenges.
- Trade tensions and political risks further fuel investor anxiety.
U.S. consumer inflation climbed from 2.4% to 2.7%,and job growth slowed with only 22,000 new jobs added in August. As an inevitable result, market experts speculate that the Federal Reserve might cut interest rates, which could boost inflation further.
Tensions between the U.S. and other nations have intensified. As a notable example, India is moving closer to China due to U.S. tariffs. The risk of weakening Federal Reserve independence adds another layer of uncertainty.
Among safe-havens, gold prices recently hit record highs, supported by massive ETF flows. china’s continued gold purchases and Goldman Sachs’ forecast of gold reaching $5,000 illustrate its growing appeal.
The Swiss franc has gained strength, rising 13% against the U.S. dollar. Its attractiveness lies in Switzerland’s stability, neutrality, and low public debt.
