US Fed Chairman Jerome Powell has thrown cold water on market optimism, resulting in a severe and synchronized sell-off of three connected assets. It was Black Thursday for gold, bitcoin, and US stocks on 20 November 2025. Powell stepped up to the plate and delivered a curveball. Policymakers are deeply divided but are leaning toward a ‘no rate cut’ scenario in December.
There’s no rate decision yet, although the minutes of the Federal Open Market Committee (FOMC) meeting late last month indicated that a cut next month is unlikely. The Fed’s benchmark rate stands at 4% after two consecutive rate cuts in September and October.
Reduced Lustre
The gold price today is $4,072.44, down 0.23% from Wednesday. The precious metal lost its lustre in reaction to the potential pause in the Fed’s rate-cutting cycle. High interest rates reduce demand for the precious metal, which keeps its price high lower. Investors tend to rotate towards interest-bearing assets like low-risk US Treasury bonds because of increased opportunity costs of holding gold.
As expected, the US dollar strengthened against other currencies due to the higher chances of a policy rate hold. Since gold prices are pegged to the greenback, it becomes more expensive for buyers.
Prime Risk Barometer
Bitcoin price today is $86,570.47, down 5% from mid-week. The poster child of cryptocurrencies and other digital coins is a risk-sensitive asset. Crypto diehards say bitcoin is digital gold. However, the painful truth is that its image as a high-risk, speculative investment persists.
BTC is on a freefall. It peaked at $123,518.28 on October 5, then fell below $100,000 on November 13. The drop from early October to November 20 is a steep 30%. If there’s a prime risk barometer for the modern financial system, many would agree that it is bitcoin.
US Benchmark Sinks
The S&P 500 Index, which represents the broad US stock market, sank 1.56% to $6,538.76 after gains on Tuesday. All 11 primary sectors closed in the red, with some wild price swings in the technology sector.
Powell effectively raised the wall of worry higher as investors frowned on the exorbitant spending of Big Tech firms on artificial intelligence. There are growing concerns regarding AI stock valuations. Valuations will drop if you use the discount rate to calculate the present-day value of future profits.
The tech-heavy Nasdaq Composite is down 3.6% for the week. Furthermore, the blue-chip Dow Jones Industrial Average lost nearly 400 points, dropping to 45,752.46 points.
Higher For Longer
People have just witnessed a modern financial Black Thursday. The ‘higher for longer’ monetary policy, not easing, is brutal news for gold, bitcoin, and US stocks. A December rate cut was a highly anticipated Christmas gift to investors.
Powell not only removed a market catalyst but also vaporized capital in all three asset classes. Notably, in the last FOMC meeting, some members generally expected US inflation to remain somewhat elevated in the near term before moving gradually to the 2% target.
However, Kevin Hassett, director of US President Trump’s National Economic Council, maintains an opposing view. He believes it is bad timing not to continue the rate-cutting cycle. The government shutdown slowed economic growth in the fourth quarter. Hassett insists that the Fed should cut rates.
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Originally published on IBTimes UK
