US Dollar in Freefall: Currency Plummets 10% Since Start of 2025 as Gold Nears $3,400 Mark

The US dollar has experienced a significant decline, dropping 10% in value year-to-date amid shifting global economic conditions. Meanwhile, gold prices have surged dramatically, approaching the $3,400 per ounce threshold as investors seek safe-haven assets. This inverse correlation between the dollar’s weakness and gold’s strength reflects broader market uncertainties and potential inflationary pressures. Analysts are closely monitoring these developments as they may signal deeper structural changes in the global financial system.

Commodity traders are losing confidence in the US dollar and relying on gold instead, as it has been the most sought-after asset since 2022. Gold prices have surged nearly 29% year-to-date, entering 2025 trading at $2,660. Its price reached a high of $3,385 on Monday’s opening bell and surged close to 1.5%, rising nearly 50 points.

While gold prices display extreme bullish sentiments, the US dollar is seeing harsh bearish conditions. The two leading assets are two poles apart with one generating Stellar returns while the other printing massive losses. The USD’s decline comes as a shock as currency investors were bullish on its prospects in 2025.

Why Is the US Dollar Crashing & Gold Prices Rising?

Financial experts reveal that Trump’s recent trade tariffs played a pivotal role in the decline of the US dollar and the rise of gold prices. The uncertainties in the global trade sector led to its decline as investor’s confidence dipped. Institutional funds, retail investors, and central banks are heavily investing in the glittery metal and reaping profits.

Central banks of countries like China, Russia, India, Brazil, and South Africa are steadily accumulating gold in their reserves. Just recently, Poland’s central bank accumulated 16 tonnes of the precious metal in its reserves. Therefore, confidence in the US dollar is on a decline while gold trust is making prices surge this year.