Bitcoin has surged past $80,000 while gold nears a three-month high as concerns over a weakening dollar bolster alternative assets.
The cryptocurrency climbed 2.1 per cent to $80,574 this morning after reaching $81,104 on Monday, its highest level since May. It has gained 25 per cent over the past month.
It extends Bitcoin's rally from last week, when the cryptocurrency surged more than 20 per cent in three days.
It followed the US Treasury's move to increase purchases of longer-dated government bonds in a bid to lower borrowing costs, which have put further pressure on the dollar.
Treasury secretary Scott Bessent last week said he was attempting to 'bring equilibrium' to the US bond market but investors are wary about his ability to curb rising long-end yields.
Meanwhile, gold is hovering at a near three-month high at $4,636 and is on track for its biggest monthly gain since 1999.
Susannah Streeter, chief investment strategist at investment firm Wealth Club, said: 'The so-called "debasement trade" is gathering momentum, with investors seeking assets that are harder to devalue through monetary policy.
'So, gold is regaining its lustre as a traditional hedge against weakening currency.'
Traders shrugged off Bessent's plan to launch an 'economic onslaught' on Iran, with brent crude settling at just under $92 a barrel.
That provided some relief for British Airways owner International Airlines Group this morning, with shares up 0.6 per cent in early trading.
The FTSE 100 rose 0.15 per cent, or 15 points, to 10,870, bringing this year's gains to 9.24 per cent.
Melrose led the charge, rising 8.5 per cent, after it confirmed that the Orange County District Court in California had closed its criminal investigation into the Garden Grove chemical leak.
The FTSE 250 gained 0.21 per cent to reach 24,769 as housebuilder Vistry's shares spiked 9 per cent after securing a grant as part of the Government's Social and Affordable Homes Programme.
Streeter said: 'The London market is proving remarkably resilient given the cocktail of geopolitical tensions, stubborn inflation concerns and uncertainty over the path of interest rates.
'The Footsie's relatively low exposure to the tech sector is also helping it avoid some of the turbulence rippling through global tech shares, giving investors a different mix of sectors to rely on.'