Bitcoin News Today: Goldman Warns: Fed's Struggle Could Trigger Dollar's Decline and a Rise in Gold and Bitcoin

Goldman Sachs has raised concerns about the U.S. Federal Reserve’s independence, warning that political pressures could have far-reaching consequences for the dollar, inflation, and financial markets. In a recent report, the investment bank suggested that gold could reach nearly $5,000 an ounce if a scenario unfolded where the Fed lost its autonomy and investors shifted a small portion of their holdings from U.S. Treasuries into bullion. The firm’s analysts highlighted that a loss of Fed independence could lead to higher inflation, lower equity and bond prices, and a decline in the dollar’s status as a global reserve currency [5].

The Fed has faced increasing scrutiny from the Trump administration, which has criticized its monetary policies and pushed for interest rate cuts. This political tension, combined with the Trump administration’s aggressive tariff policies, has fueled concerns about stagflation—a mix of high inflation and stagnant economic growth. Financial markets have reacted with rising gold prices, a weaker U.S. dollar, and a steepening yield curve, signaling elevated risk [6]. In this context, gold is increasingly seen as a store of value that does not depend on institutional trust, making it an attractive asset for investors seeking to hedge against economic and political uncertainties [5].

The current bull market for gold has been driven by central bank purchases and expectations that the Fed will soon reduce interest rates. Through August 2025, gold prices had surged 31% year-to-date, reaching record highs. Goldman Sachs attributed this rise to a combination of macroeconomic and political factors, including the erosion of the Fed’s independence and the likelihood of a weaker dollar. The firm’s analysts noted that gold remains their highest-conviction long recommendation in the commodities space, emphasizing its role as a safe-haven asset amid growing global uncertainties [6].

Bitcoin has also become a focal point in the shifting financial landscape. Analysts suggest that Bitcoin could experience a "massive" price movement, with the cryptocurrency recently rebounding above $112,000 and liquidating short positions. The market’s performance has been closely linked to expectations around the upcoming U.S. jobs report and potential interest rate cuts by the Fed. Some traders believe that a weaker-than-expected jobs report could signal a slowing labor market, increasing the probability of a rate cut and providing a tailwind for Bitcoin prices [3].

Political developments have also shaped the crypto landscape. The Trump family has entered the Bitcoin mining sector with the launch of American Bitcoin, a publicly traded company focused on mining and accumulating Bitcoin. The company’s strategy includes leveraging its brand and audience to amplify value, highlighting the intersection of politics and cryptocurrency. However, the mining industry faces intense competition and high energy costs, making it a challenging space for new entrants. The Trump-backed venture aims to capitalize on U.S. nuclear energy expansion, a policy initiative that could benefit data centers and miners in the long term [4].

The interplay between gold, Bitcoin, and the U.S. dollar reflects broader concerns about the future of monetary policy and global financial stability. As political pressures on the Fed continue to mount, markets are recalibrating their expectations for inflation, interest rates, and currency values. Both gold and Bitcoin are being viewed as alternatives to traditional assets in a world where institutional trust is increasingly questioned. These dynamics are likely to shape the trajectory of global financial markets in the months and years ahead, as investors seek to protect their portfolios against a range of macroeconomic and geopolitical risks [5].

Source:

[1] title1 (https://finance.yahoo.com/news/goldman-sachs-issues-a-warning-to-ai-stock-investors-103249786.html)

[2] title2 (https://nypost.com/2025/09/04/business/goldman-sachs-says-gold-could-hit-5k-as-fears-grow-over-federal-reserves-independence/)

[3] title3 (https://cointelegraph.com/news/bitcoin-analysts-see-massive-move-btc-price-regains-112k)

[4] title4 (https://www.axios.com/2025/09/04/trump-abtc-american-bitcoin)

[5] title5 (https://finance.yahoo.com/news/goldman-sachs-says-gold-could-034116657.html)

[6] title6 (https://sprott.com/insights/challenges-to-fed-autonomy-strengthen-case-for-gold/)