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A new survey has found that central banks plan to further boost their %Gold reserves this year as they decrease their holdings of U.S. dollars over the coming five years.

Geopolitical concerns, macroeconomic uncertainty, and concerns about the status of the U.S. dollar are driving central banks around the world to make record gold purchases.

Gold recently overtook the Euro currency to become the world's second-largest reserve asset, behind the U.S. dollar.

Gold prices have surged 30% this year and doubled in the last two years as global uncertainty and market volatility have propelled central bank demand for bullion.

Now, a record 95% of central bank respondents to a World Gold Council survey say they expect their gold holdings to increase over the next 12 months.

That's the highest level since the annual poll began in 2018.

Meanwhile three-quarters (75%) of central banks said they expect their U.S. dollar holdings to decline over the next five years. A total of 70 central banks responded to the survey.

Another key finding of the survey is that, due to geopolitical tensions, a growing number of central banks plan to store gold domestically rather than in New York or London, which are the world's two largest repositories of the precious metal.

The U.S. government's erratic approach to global affairs under U.S. President Donald Trump has contributed to unease among many central banks.

Central bank gold buying has accelerated since Russia invaded Ukraine in 2022. There is also a move among central banks to diversify away from the U.S. dollar.

Gold is currently trading at $3,404.70 U.S. per ounce and is not far from its all-time high of just over $3,500 U.S.