The precious metals rally is astonishing, with gold and US dollar prices posting their best annual performance in nearly half a century.

2025 is coming to an end, and the precious metals market has delivered an impressive report card for investors. According to market reports, gold and silver have achieved their highest annual gains in nearly fifty years, marking the best yearly performance since 1979.

Under the dual catalysts of escalating geopolitical tensions and the Federal Reserve’s rate cut policies, the gold price in USD and safe-haven assets like silver received strong support. On the last trading day of the year, spot gold was quoted at $4,320 per ounce, and silver reached $71 per ounce. Despite a price correction near the year’s end, the overall increase remains significant.

During the year-end period, market activity noticeably slowed, and precious metal prices experienced typical wide-range fluctuations. A sharp decline on Monday, a strong rebound on Tuesday, and another pressure on Wednesday reflected high volatility and market sentiment instability. The Chicago Mercantile Exchange (CME) responded to the intense volatility by raising margin requirements twice to prevent systemic risks.

The core drivers supporting the continued rise of gold prices in USD come from multiple factors. First, the complex geopolitical environment has intensified the demand for safe-haven assets, with investors tending to allocate more to traditional safe assets like gold. Second, developed economies face long-term inflation pressures and increasing debt burdens, which boost demand for precious metals’ hedging functions. The Fed’s rate cut cycle further enhances gold’s appeal in a low-interest-rate environment, as non-yielding assets become more valuable when real yields decline.

The formation of this precious metals bull market reflects the accumulation of risk factors in the global economic landscape and a shift in investor sentiment.