The price correlation between gold and its digital counterpart rose above 0.3. Over the past year, the gauge has hovered within a range of -0.3 to 0.2, Kaiko said in a new study.
Kaiko: Bitcoin’s correlation with gold hit its highest level in more than a year last week. As the U.S. Dollar continues strengthening, negatively impacting both crypto and gold, the correlation between the two assets has shifted. https://t.co/lyVSwSAvkX pic.twitter.com/h9YxFFGOFM
— Wu Blockchain (@WuBlockchain) October 6, 2022
Analysts noted that gold had failed to confirm its status as a safe‑haven asset amid the tightening of monetary policy by the Fed. As the dollar strengthened, the correlation between the precious metal and Bitcoin rose.
The change in the tone of the market may also have been indirectly influenced by the UK debt market. The jump in 30-year gilt yields to the highest since 2002, at 5%, gave way to a pullback as the Bank of England launched a temporary asset-buying programme.
«This steadied the situation for the moment, but concerns about ‘global contagion’ and a further rush for risk are rising», experts noted.
Against a backdrop of destabilisation in debt markets and sharp devaluations of the British pound and the euro against the dollar, there was observed a sharp spike in purchases of digital assets in those fiat currencies.
On September 21, Bitcoin reacted with a correction to the Federal Reserve’s rate hike.
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