Gold prices have surged to $4,378 per ounce in 2025, achieving a year-to-date increase of over 66%, the best annual performance since 1979. This rally is driven by a weakening U.S. dollar, exacerbated by rising U.S. debt, government shutdowns, and regional banking crises. The Federal Reserve's rate cuts and declining real interest rates have further boosted gold's attractiveness as a zero-yield asset. Geopolitical tensions and inflation expectations have also spurred demand for gold, with central banks, especially in emerging markets, increasing their reserves. Both institutional and retail investors have contributed to the surge, with significant inflows into gold ETFs and physical gold sales.