Ken Griffin, CEO of Citadel, expressed deep concern this week about the high price of Gold and its implications for the US dollar’s role as a global safe haven, according to Bloomberg. Gold futures just breached $4,000 per ounce, marking a gain of more than 50% so far in 2025.
The US dollar, measured by the US dollar index (DXY) which tracks the value of the dollar against a basket of major foreign currencies, including the euro, yen and pound, has lost about 10% of its value this year and is currently near 98.5.
Griffin told Bloomberg: “We are seeing substantial asset inflation away from the dollar as people look for ways to effectively de-dollarize or de-dollarize their portfolios with respect to US sovereign risk.” Griffin added: “We are definitely in some sugar in the US economy right now.” U.S. stocks are at all-time highs amid a boom in artificial intelligence and high-performance computing.
The “debasement trade” narrative has resurfaced, referring to investors turning to hard assets like gold, silver and bitcoin as hedges against monetary debasement, a process in which excessive money creation reduces the purchasing power of a currency.
Meanwhile, the US government remains in a partial shutdown and rate cuts are expected. According to the CME FedWatch tool, markets are pricing in a 92% probability of a 25 basis point cut at the next meeting on October 29, which would reduce the federal funds rate to a range of 3.75%–4.00%. Additional cuts are expected at the end of the year, reducing the rate to between 3.50% and 3.75%.
Bitcoin has risen 9% in October, hitting a new all-time high of $126,000 on Monday.
