Cryptocurrency Surge: Bitcoin Hits New Heights Amid Monetary Shift

Bitcoin has soared over $105,000, amid Federal Reserve interest rate speculations and Trump's proposed bitcoin reserve. The U.S. dollar remains strong, supported by Treasury yields, while other currencies fluctuate due to central bank decisions. Analysts express inflation concerns as the economy reacts to high interest rates.

In a dynamic start to the financial week, Bitcoin surged beyond $105,000 for the first time, driven by President-elect Donald Trump's possible plan to establish a U.S. bitcoin reserve, akin to the existing strategic oil reserve. Signals from the Federal Reserve on interest rates added another layer of complexity for traders.

Major currencies displayed mixed reactions; the dollar nearly reached a three-week high, bolstered by climbing U.S. Treasury yields, despite projections for minimal rate easing in 2025. The yen struggled after mixed news from the Bank of Japan, and sterling faced pressure following unexpected economic performance data.

As the economic landscape faces potential shifts, the Federal Reserve's inward focus on inflation remains critical. Market analysts remain cautious, recognizing the challenges posed by Trump's forthcoming administration and its potential inflationary impact, similar to comments from the Bank of Canada Governor.

(With inputs from agencies.)